In February, concerns about inflation decreased slightly from the previous quarter, which helped consumer optimism about the US economy reach its highest level in almost two years. Although US consumers felt less pressure to save for an eventual rainy day, 20 percent were still pessimistic about the economy—but this represented the lowest reported pessimism rate since June of 2022 (although consumers were still more pessimistic than they were at the beginning of the COVID-19 pandemic). The following five charts highlight the findings from our latest ConsumerWise research in the United States.

As inflation figures continue to fluctuate, will consumers continue to gain confidence in the economy and, therefore, continue to express an interest in splurging? Or will higher-for-longer interest rates slow spending? Watch this space for regular updates on the state of the US consumer. Check out our ConsumerWise page, and contact us for data from previous updates or additional insights.

ABOUT THE AUTHOR(S)

Christina Adams is a partner in McKinsey’s Dallas office, Kari Alldredge is a partner in the Minneapolis office, Lily Highman is a consultant in the New York office, and Sajal Kohli is a senior partner in the Chicago office.

The authors wish to thank Isabelle Engelsted, Alex Lequerica, Andrew Pitakos, Tom Skiles, and Eitan Urkowitz for their contributions to this article.

This article was edited by Alexandra Mondalek, an editor in the New York office.

By Christina Adams, Kari Alldredge, Sajal Kohli, and Eitan Urkowitz

Despite inflation slowing considerably from its mid-2022 peak, consumers still expressed caution in November about overspending, given lingering uncertainty about the economy and geopolitical tensions. Consumers said they are planning to reduce their overall spend, being more selective in the products they purchase and places they splurge. The following five charts highlight the findings from our latest ConsumerWise research in the United States.

Will US consumer sentiment trend up or down as we head into the new year? What will that mean for manufacturers and retailers as they finalize their 2024 strategies? Watch this space for regular updates on the state of the US consumer. Check out our ConsumerWise page, and contact us for data from previous updates, more information, or additional insights.

ABOUT THE AUTHOR(S)

Christina Adams is a partner in McKinsey's Dallas office, Kari Alldredge is a partner in the Minneapolis office, Sajal Kohli is a senior partner in the Chicago office, and Eitan Urkowitz is a communications specialist in the Washington, DC, office.

The authors wish to thank Miranda David, Isabelle Engelsted, Andrea Leon, Alex Lequerica, Andrew Pitakos, and Tom Skiles for their contributions to this article.

This article was edited by Alexandra Mondalek, an editor in the New York office.