MICHEL MARTIN, HOST:
Resilient. That's how many economists are describing U.S. shoppers this summer. Despite rising inflation, new tariffs and threats of more, Americans boosted their spending last month. NPR's Alina Selyukh explains what happened.
ALINA SELYUKH, BYLINE: New federal data shows spending at stores and restaurants rose six-tenths of a percent. That's much more than experts had forecast after months of tighter budgets and anxiety. Heather Long is the chief economist at Navy Federal Credit Union.
HEATHER LONG: Things were looking pretty grim in April and May, but they really bounced back in June.
SELYUKH: Why did they? A few reasons. One is bargain hunting. Data shows where President Trump's tariffs have started to push prices higher, people are buying less, like furniture and electronics.
LONG: But if they feel like they can get a deal, such as clothing, where we haven't seen big price spikes yet, they're doing it. They're taking advantage.
SELYUKH: That's especially true for back-to-school shopping, which people started earlier this year, like, better buy things now at a decent price. Who knows what happens next? Which, in fact, is the second factor that's keeping us shopping.
JOHN MERCER: The tariff fears that we really saw amongst consumers earlier in the year, I think it's become almost fatigue.
SELYUKH: John Mercer tracks retail at the analytics firm Coresight Research. Every week, the group asks hundreds of shoppers how they feel. And lately, their sentiments started improving. People have spent months expecting the worst impacts of tariffs, skyrocketing prices, empty shelves. But trade deals keep changing, tariffs get paused, retailers eat the costs.
MERCER: Tariffs have been kicked down the road, kicked down the road.
SELYUKH: And the worst has not come. And so many went from planning for the worst-case scenario to thinking, what if it's, equally plausible, the best-case scenario?
MERCER: It's almost like they think the tariff impacts may never come.
SELYUKH: And they might as well loosen their belts a little, shopping for sports equipment, going out to eat. Heather Long says a key factor underpins all this.
LONG: Middle-class Americans and moderate-income Americans are definitely worried, but right now they're still employed.
SELYUKH: The jobs market is chugging along. And steady paychecks are giving people the confidence to do mini splurges.
LONG: You maybe don't see as many people going to Europe, but they're willing to take their kids out for pizza on Friday or spend a little bit more on going to Six Flags.
SELYUKH: Because tariffs might come and go, but memories are forever.
Alina Selyukh, NPR News. Transcript provided by NPR, Copyright NPR.
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