Latest / Markets with Megan: A Quick Financial Markets Update / U.S. Shoppers Ignore the Noise | S3 E140 | 04-22-26

Transcript

U.S. Shoppers Ignore the Noise | S3 E140 | 04-22-26 · Markets with Megan: A Quick Financial Markets Update

• 0:00
  Megan Horneman: There is not much that can stop the U.S.
• 0:02
  Megan Horneman: consumer, according to the March retail sales report.
• 0:06
  Megan Horneman: It's Wednesday, April the 22nd, and this is Markets with Megan.
• 0:09
  Megan Horneman: If you like this podcast, you can subscribe, hit the alarm bell, share it with any of your friends, your colleagues, family members, anybody who's interested in what's really going on with the economy.
• 0:20
  Megan Horneman: We get regular economic data that gives us insight into the direction that we're going.
• 0:25
  Megan Horneman: And today we're going to focus on the consumer.
• 0:27
  Megan Horneman: So let's dig right in.
• 0:29
  Megan Horneman: The March retail sales report was much better than was anticipated.
• 0:35
  Megan Horneman: On a month-over-month basis, the uh retail sales at the headline level, so that includes all items, that rose 1.7% for just the month of March.
• 0:46
  Megan Horneman: It was the biggest monthly increase in 12 months.
• 0:50
  Megan Horneman: The expectation was that we would see a 1.4% increase.
• 0:54
  Megan Horneman: Now, that headline number was primarily due to about a 15% increase in spending at gasoline stations.
• 1:01
  Megan Horneman: And sometimes when we look at this, we will X out volatile items because that headline number may be misrepresenting the strength in the consumer.
• 1:10
  Megan Horneman: But when we strip out items like autos, like gasoline, building materials, food, still very strong numbers.
• 1:19
  Megan Horneman: So let's look at just Xing out autos and gas.
• 1:23
  Megan Horneman: Retail sales rose 0.6%.
• 1:25
  Megan Horneman: The expectation was for them to rise 0.3.
• 1:28
  Megan Horneman: And when you X out food, gas, building materials, autos, um the it rose 0.7%.
• 1:36
  Megan Horneman: It was the biggest rise since August of 2025, 25.
• 1:41
  Megan Horneman: And the expectation was only for a 0.2% rise.
• 1:45
  Megan Horneman: Now let's look within the details at what consumers are spending money on.
• 1:49
  Megan Horneman: You're seeing very discretionary spending in the month of March, meaning that some of the things like furniture, electronics, uh, going out to eat, spending money on the internet, these were all big drivers.
• 2:03
  Megan Horneman: Furniture spending rose the most most since December of 2024, as did spending on food and beverages.
• 2:13
  Megan Horneman: So this is a strong report.
• 2:15
  Megan Horneman: There's not much that I can say negative about this report.
• 2:19
  Megan Horneman: But why did the consumer spend so much in a month where we were dealing with the war in Iran and sky-high gasoline prices?
• 2:27
  Megan Horneman: Well, don't forget that we have tax refunds.
• 2:29
  Megan Horneman: We got a lot of tax refunds in the month of March, and um tax season is now officially over, but we did see a very big increase on an annual basis in tax refunds.
• 2:40
  Megan Horneman: So that money looks to have been spent.
• 2:42
  Megan Horneman: Consumers are looking like these spikes in gasoline are temporary because they were spending quite a bit in the month of March.
• 2:50
  Megan Horneman: The last thing I'll say about this report is remember, it is not inflation adjusted.
• 2:56
  Megan Horneman: Um, so uh what we will do is we'll look for it's some more indication on the consumer, the health of the consumer.
• 3:02
  Megan Horneman: This report does not correlate with the really weak consumer sentiment that we got because weak consumer sentiment is not um disregard, is not um uh having consumers avoid going to the stores.
• 3:16
  Megan Horneman: That's all we have today.
• 3:17
  Megan Horneman: If you want a history of our podcast, you go to marketswithmegan.fm.
• 3:21
  Megan Horneman: Thank you.