Macy’s CFO, Adrian Mitchell, informs the average American consumers as healthy. Things may be different for lower-income citizens.
The average expenditure of an American consumer remains constant. Though, the rising prices in oil can put grocery bills also at a high stake. The department store chains are expecting a decline in shopping. Some consumers are likely to get affected.
To look from a consumer point of demand, there are healthy consumers. It was during the presentation at UBS Global Consumer & Retail Conference.
The American consumers are getting benefitted from various stimuli. The ones mostly from the government payments around the world. The saving rates are elevating the pre-pandemic levels.
The customer is facing different kinds of pressure. Inflation is one of them. The result of the geopolitical unrest in Ukraine and Russia. The rising oil prices will just raise the cost of vital items.
Macy predicts that lower-income families to get affected the most. These American consumers spend a larger share of their monthly wages on necessities. It includes groceries and other goods.
The company is already looking to tackle this problem. It is about how to communicate value to those customers differently. There has to draw a line from a premium customer. They will be spending power.
The value will be important. Though, it will mean different things depending on the levels of income of the household.
With US crude reaching a 13-year high of $130 a barrel, Oil prices rose sharply to begin the week. It has since fallen in Wednesday morning trading.
The consumer price index for January gauges. The prices of a variety of ordinary consumer products. It also increased 7.5 percent from the previous year. That was the highest level recorded since 1982.
The macroeconomic headwinds such as inflation and supply chain issues are on the rise. But, Macy’s provided a better-than-expected financial projection for 2022 in late February. Its stock has increased by over 60% in the last year.