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Are consumers actually spending?

Consumer sentiment sits at 44.8 as of July 2026, yet retail sales are up 7.19% year-over-year — a gap between how people feel and how they spend.

The July 2026 Consumer Read

Consumer mood is weakening even as people continue to spend.

Consumer sentiment has fallen sharply and real wage growth is nearly flat, yet retail sales remain solid. Savings are scraped down to 3%, suggesting people are borrowing or depleting reserves to maintain spending.

Watch Zone Sentiment 44.8 Retail sales 7.19%
Data through July 2026 · Refreshed Jul 28, 2026 · Sources: FRED, BEA, Univ. of Michigan
Sentiment-spending gap · higher = wider gap
61/100
Watch Zone
0 · Resilient100 · Fragile
Recent trendpeak 75 · Dec 2025
Households are spending money they don't have right now, either by drawing down savings or taking on debt. How this score is built →
Consumer Sentiment
44.8
-5.0July 2026
Retail Sales YoY
7.19%
-0.6ppJuly 2026
Real Income Growth
0.02%
+1.1ppJuly 2026
Consumer Credit Growth
2.10%
-0.2ppJuly 2026
Wage Growth
3.52%
+0.1ppJuly 2026

Feeling vs. spending since 2021.

Consumer sentiment is how people say they feel. Retail sales are what they actually buy.

Consumer sentiment Retail sales (YoY)

What changed

Consumer sentiment has fallen sharply and real wage growth is nearly flat, yet retail sales remain solid. Savings are scraped down to 3%, suggesting people are borrowing or depleting reserves to maintain spending.

What it means for you

Households are spending money they don't have right now, either by drawing down savings or taking on debt. This matters because it's not sustainable—when savings run out or people stop borrowing, spending will drop and economic growth will slow. Watch retail sales over the next few months: if it starts to decline, it signals that the spending boost from credit and depleted savings is ending.

What to watch next.

Jul31 PCE Inflation report. Watch for core PCE to confirm whether the uptick to 3.41% reflects a genuine reversal or noise. The Fed targets 2% on this measure.
Aug7 Nonfarm Payrolls report. The 57,000 print was weak. A rebound above 150,000 would ease recession fears; another decline would deepen labor market concerns.
Jul29 GDP release. Current growth stands at 2.10%. A slowdown here combined with weak jobs data could force the Fed to cut rates sooner than expected.

Latest consumer analysis.

Written after each data release. Plain English, no jargon.

Retail Sales Yoy

Retail Sales June 2026: Consumer Spending Up 6.71%

Retail sales rose 6.71% from a year ago, still a strong pace, but growth cooled from the spring peak. Americans are spending, just not accel

July 2026
All analysis →

Quick answers.

The questions people actually ask about consumer spending, answered from the data above.

Are consumers still spending money?
Yes — retail sales are up 7.19% year-over-year as of July 2026, even as consumer sentiment sits at 44.8, near multi-year lows.
Why does spending stay strong if confidence is so weak?
Real income growth is only 0.02% a year, but consumer credit is growing 2.10% — households are increasingly financing spending with debt rather than income gains, so the mood and the money don't move together.
Is this spending sustainable?
Wage growth of 3.52% a year is barely outpacing prices, and unemployment sits at 4.2%. If income growth doesn't catch up or credit growth doesn't cool, spending eventually has to slow or defaults start rising.
What is the Sentiment-Spending Gap score?
A 0-100 score built from consumer sentiment, retail sales, real income growth, and consumer credit growth. Higher means a wider gap between how people feel and how they're actually spending. The current read is 61 — watch zone.