Why the Most Important Driver of the U.S. Recovery Is Still Intact
When U.S. retail sales came in lower than expected last week, some began to worry that the average consumer wasn't as strong financially as previously believed, but according to analysts at Macquarie Capital Markets Ltd., this is just a blip on the radar.
While there are a number of reasons for consumers to be more cautious with political uncertainty across the globe and unrest overseas, Macquarie's David Doyle says that the underlying trend shows people are getting jobs, earning more money, and then spending some of those funds.
"Most important in assessing data are the underlying trends," Doyle writes. "On a year-over-year basis, which removes a large portion of the month to month volatility, spending trends remain firm." To back up his claim, Doyle touched on a few reasons for his optimism.
Consumers still have a fair amount of confidence
They might be slightly less confident than they were at the start of 2015, but Macquarie points out that they are still pretty optimistic. "While consumer confidence levels have trended sideways over the last 1.5 years, they remain near levels seen in the prior expansion."
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http://www.bloomberg.com/news/articles/2016-08-15/why-the-most-important-driver-of-the-u-s-recovery-is-still-intact
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