A recent Bank of America report shows that consumer spending has been up 5% year over year. Mary Hines Droesch, head of product for Consumer Business and Wealth Management, Banking and Lending at Bank of America joined TheStreet to unpack why consumers will remain resilient in 2025.
Related: Surprising December retail sales report upends inflation bets
Full Video Transcript Below:
CONWAY GITTENS: When you look at the data, what are you seeing in terms of the health of the overall consumer?
MARY HINES DROESCH: Yeah, the consumer remains healthy. We see spend across all of our Bank of America consumer clients up 5% year over year. And that's just shows they're out there living their lives. They've had a lot of wage growth, which is enabling them to fight inflation, to continue to spend. Our discretionary spend remains stable and we're not seeing a significant rise in. Delinquencies and ultimately people going back on their debt.
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CONWAY GITTENS: And what about your outlook for 2025? Because we were expecting more rate cuts to come and it looks like that might not happen. The data is starting to show inflation is heating up again. So what are you thinking in terms of the consumer. The mood of the consumer, the actions of the consumer in 2025?
MARY HINES DROESCH: We continue to see really strong consumer sentiment that's actually increased more recently. But as this inflation data, it's going up, it's going down. So it continues to be a very volatile. Rate environment as far as expectations, but we're seeing really positive things with the consumer. So we don't have any concerns. Still expect a soft landing. We'll see those rate cuts. They'll be at 90% We're going to get one and then they go to 40, depending on the latest data point. But what's most important for our consumers is they're employed. They're paying their bills and they're enjoying their lives.
