Watching Consumer Spending 8/12/26

Summary

Consumer spending, a key driver of US growth, is showing mixed signals. High-income consumers are holding up overall but increasingly trading down to dollar stores, while goods consumption has weakened significantly.

• Consumer spending accounts for two-thirds of US economic growth.
• Steve Liesman questions whether the drag from gasoline prices has run its course.
• Michael Gunther notes the consumer has been resilient, with high-end spenders supporting growth, but also driving dollar store growth as they become more discerning.
• Barry Knapp cites a sharp slowdown in goods consumption, challenging the consumer resilience narrative.
• The trade-down trend may benefit dollar store operators.