Federal Reserve (Fed) Bank of Atlanta President Raphael Bostic took a general measure of the US economy’s health, noting a general weakening in the latest round of labor data, and also noted that certain segments are struggling under the weight of tariffs more than others.
Taken in the aggregate, the Fed’s Bostic accidentally pointed out that lower-income Americans, who represent the overwhelming majority of the population, are struggling to afford living in the US, while higher-income Americans are beginning to feel financial stress but overall remain in a healthier place than their lower-income peers.
Key highlights
Tariffs may cause structural changes.
Feel like we have the luxury today to wait to make a policy adjustment because the labor market remains strong.
Unemployment remains remarkably low.
Data suggests labor markets weakened over the last three months.
Low-to-moderate income consumers are facing some stress, and that stress is starting to move up the income scale.
Upper income consumers are still ok.
Small businesses are feeling stress much more than larger businesses.
Firms expectations for hiring and sales are gloomier.
We know a lot more people are using credit cards to buy things that they weren’t before, it’s signaling something about where the consumer is.
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