Latest / Markets with Megan: A Quick Financial Markets Update / Spending Cools And Dining Out Stays Hot | S2 E097 | 11-25-25

Transcript

Spending Cools And Dining Out Stays Hot | S2 E097 | 11-25-25 · Markets with Megan: A Quick Financial Markets Update

• 0:00
  Megan Horneman: The consumer entered the fourth quarter on a very cautious note, as we saw in the September retail sales data.
• 0:07
  Megan Horneman: It is Tuesday, November the 25th, actually.
• 0:11
  Megan Horneman: This is Markets with Megan.
• 0:13
  Megan Horneman: If you like this podcast, please subscribe, hit the alarm bell, share this with friends, family, or colleagues.
• 0:18
  Megan Horneman: But we're here today to break down that economic data which we're finally receiving again now that the government has reopened.
• 0:24
  Megan Horneman: So we're going to drop a couple of uh Markets with Megan today, but we want to focus first on the data we got on retail sales.
• 0:31
  Megan Horneman: This is for the month of September, and the data came in a little bit weaker than expected.
• 0:36
  Megan Horneman: What we focus on is stripping out all of those volatile items.
• 0:40
  Megan Horneman: So think about uh gasoline, food, building materials, autos.
• 0:45
  Megan Horneman: When you look at this true core retail sales number, this one actually does go into the calculation for good spending in GDP.
• 0:53
  Megan Horneman: That actually fell for the month of September, and it was the worst drop we've seen since April when we had a lot of skittishness around the Liberation Day impact in the markets.
• 1:03
  Megan Horneman: Now let's focus on what we saw, the weakness.
• 1:06
  Megan Horneman: It was led by a lot of discretionary items.
• 1:08
  Megan Horneman: If you look at things like motor vehicles, electronics, clothing, sporting goods, um non-store retailers, which is basically internet shopping, all of that declined for the month.
• 1:20
  Megan Horneman: You did see increases in health care and personal, health and personal care.
• 1:25
  Megan Horneman: This is something that's not necessarily discretionary.
• 1:28
  Megan Horneman: You saw a 1.1% increase for the month.
• 1:31
  Megan Horneman: When you look at restaurant spending, this is the one that just continues to defy expectations.
• 1:36
  Megan Horneman: So consumers may be pulling back on all things goods related, but they're still going out to eat.
• 1:42
  Megan Horneman: That actually rose.
• 1:43
  Megan Horneman: Now, when you look at just pure discretionary spending, it's an index that we've created here.
• 1:49
  Megan Horneman: You can see that year over year, discretionary spending for the month of September was running about a 3.3% level.
• 1:57
  Megan Horneman: That's a little bit below the historical average we've seen of an annual increase since the early 1990s.
• 2:04
  Megan Horneman: So that's telling us that the consumers went into the fourth quarter just a little bit more skittish on spending.
• 2:10
  Megan Horneman: And we might see that translate into the retail, the big holiday sales that we will be getting.
• 2:16
  Megan Horneman: Although the retail federation does expect there to be spent about a trillion dollars on holiday spending here in December.
• 2:23
  Megan Horneman: That's not much higher than last year, basically unchanged, but you are expected to see a big spend here for this holiday season.
• 2:31
  Megan Horneman: We'll be back again with some work information on the consumer that we saw today.
• 2:35
  Megan Horneman: If you want a history of our podcast, you can go to marketswithmegan.fm.
• 2:38
  Megan Horneman: Thank you.