From CNBC: 2025-04-28 12:42:00

Global markets brace for impact as U.S. President Donald Trump imposes import tariffs on multiple countries, raising concerns about trade and growth. America’s consumer landscape in 2025 shows a divide, with lower-income earners cutting back on spending while the wealthy continue to indulge in luxury items.

As anxiety over Trump’s trade policies spreads, early signs of stress appear among economically vulnerable consumers. Synchrony reports a 4% spending drop in Q1, contrasting with American Express and JPMorgan Chase seeing a rise in spending from wealthier clientele. Consumer behavior shifts towards essentials amid tariff concerns.

Credit card users making minimum monthly payments hit a 12-year high at 11.1% in Q4, signaling increased debt levels. Wealthier credit card lenders remain insulated from economic concerns, with high-end consumers spending more while lower-income individuals pull back. Consumer spending shifts towards essentials over travel and entertainment due to tariff worries.

Citigroup and Bread Financial report a shift towards essential purchases and away from travel and entertainment as consumers brace for potential price hikes from tariffs. Spending habits show a focus on electronics, home furnishing, and auto parts, leading to uncertainty about future demand. The divide between high and low-end consumers remains apparent in credit card spending patterns.

Read more: Wealthy consumers up spending while the rest of America cuts back