Fitch predicts a significant slowdown in U.S. consumer spending

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U.S. consumer confidence hit a four-month low in September, driven by concerns about rising interest rates, increased living costs, and the potential for a government shutdown, highlighting growing frustration with inflation’s impact on essential expenses.

American consumers have a lot on their minds right now — and things are likely to get worse

“Americans are facing economic challenges on multiple fronts.

U.S. consumer confidence fell to a four-month low in September, as people became more concerned about rising interest rates, an increased cost of living and a potential government shutdown, the Conference Board said Tuesday.

“To use a phrase from my childhood in the South, households are ‘sick and tired’ of inflation,” Stephen Stanley, chief U.S. economist at Santander U.S. Capital Markets, wrote in a note. The “average consumer is spending a substantial portion of their budget on food and energy and [is] unwilling to ignore those prices,” he added.

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‘We just see a series of these things adding up to a less vibrant consumer.’

— Doug Duncan, chief economist, Fannie Mae
And consumers have begun showing signs that they are, in some respects, behaving more cautiously. “We just see a series of these things adding up to a less vibrant consumer,” Doug Duncan, senior vice president and chief economist at Fannie Mae, told MarketWatch, citing rising credit-card delinquencies as well as the resumption of student-loan payments in October.”

Store crime is among a host of other challenges, such as pullback in consumer spending and excess inventory, that retailers are also contending with as they try to lift their store sales and make decisions on which stores to shut down.

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