Spending Faces Steep Fall

The article points to three warning signs for U.S. consumer spending, which accounts for about 70% of GDP: rising debt burdens, increasing delinquencies, and consumer confidence falling to some of its lowest levels since tracking began in the 1980s. The share of households spending more than 40% of their income on debt payments has reached its highest level since 2013, while delinquencies on auto loans and credit cards have climbed to their highest levels since the period following the 2007–2009 recession. Although delinquency rates remained stable in the first half of 2026, the article warns that inflation, weak hiring, and high interest rates could prompt households to cut back on purchases, with the labor market remaining the decisive factor for many.

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