Consumers still spending
U.S. consumer spending rose in August, an indication household budgets remain resilient amid economic concerns.
Overall spending rose an inflation-adjusted 0.4% from July, with recreational goods and clothing among the standout categories, according to a Wells Fargo analysis of Commerce Department data released Friday. Personal income rose by the same amount.
"Continued discretionary spending tells us that, even as household wallets have shifted this year in an effort to mitigate tariff-induced uncertainty, consumers haven't gone into hiding and are still spending," Wells Fargo said in its report.
The banking giant said upward revisions to recent data show that spending could increase twice the pace of its previous estimate for the third quarter. "We still see downside risk around coming consumption, but the household sector is on more solid footing than previously indicated," the Wells Fargo report stated.
US imposing home goods tariffs
President Trump this week announced a round of tariffs on upholstered furniture and cabinetry that could lead to increased costs for homebuyers and remodelers.
Beginning Wednesday, a 50% tariff will apply to imported kitchen cabinets, bathroom vanities and associated products, while a 30% levy will apply to imported upholstered furniture, Trump wrote on social media platform Truth Social.
"The reason for this is the large scale 'FLOODING' of these products into the United States by other outside Countries," Trump wrote. "It is a very unfair practice, but we must protect, for National Security and other reasons, our Manufacturing process."