CONSUMER CRUNCH

While prices have risen about 3%/year lately, consumers may be focused on the fact that through CY2025 they’re up 28% compared to pre-Covid. And here’s the rub. Despite inflation-adjusted wages rising 2.8% since pre-Covid, 34% of workers saw their real wages decline from late 2020 through 2025. Add rising rates and home prices, which aren’t directly in inflation calculations, and perhaps that’s why consumer sentiment stinks.