LIVE MARKETS-Spending rises but with it, worries a new gap is forming: BofA

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SPENDING RISES BUT WITH IT, WORRIES A NEW GAP IS FORMING: BOFA

Despite weather-related disruptions in January, consumer spending showed "solid resilience" with total card spending rising 2.6% year-over-year, according to Bank of America.

Using its latest internal data, BofA reports that this was the strongest pace of growth in nearly 2 years.

However, they note that income-based differences in spending and wage growth persisted and they cite worries that "a 'K' shape is opening up between higher-income households and middle-income households, alongside the existing gap with lower-income households."

Still they note that households are still "adaptive and financially stable overall in the face of significant affordability challenges, supported by trading‑down behaviors, elevated savings and “dry powder” to borrow."

And they say that higher tax refunds could provide "significant support for consumers."

(Sinéad Carew)

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