Why the American consumer will remain healthy in 2025

The Street

Mary Hines Droesch, head of consumer & small business products at Bank of America, joins TheStreet to share why she thinks consumers will remain healthy in 2025.

Transcript

00:00When you look at the data, what are you seeing in terms of the health of the overall consumer?

00:09The consumer remains healthy. We see spend across all of our Bank of America consumer clients up 5% year over year.

00:19And that just shows they're out, they're living their lives.

00:23They've had a lot of wage growth, which is enabling them, despite inflation, to continue to spend.

00:29Our discretionary spend remains stable, and we're not seeing a significant rise in delinquencies and ultimately people going bad on their debt.

00:39And what about your outlook for 2025? Because we were expecting more rate cuts to come, and it looks like that might not happen.

00:48The data is starting to show inflation is heating up again.

00:50So what are you thinking in terms of the consumer, the mood of the consumer, the actions of the consumer in 2025?

00:59We continue to see really strong consumer sentiment that's actually increased more recently.

01:05But as you know, this inflation data, it's going up, it's going down.

01:09So it continues to be a very volatile rate environment as far as expectations.

01:17But we're seeing really positive things with the consumer.

01:20So just we don't have any concerns.

01:23Still expect a soft landing.

01:26We'll see. Those rate cuts, they'll be at 90%.

01:28We're going to get one, and then they go to 40, depending on the latest data point.

01:32But what's most important for our consumers is they're employed.

01:36They're paying their bills and they're enjoying their lives.

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