Consumers opened up their wallets more than expected, but that is not expected to continue. In the fourth quarter, consumer expenditures rose by 4.4 percent, more than Wall Street economists had anticipated, considering the relatively high unemployment rate and the rising price of gasoline. Recent surveys have found consumer sentiment recovering in part because the stock market has been buoyant.
But Sohn expects that consumers will slow their buying binge. “Income levels are not up much, and [households] continue to reduce their debt,” he observes.
In addition, so far in the first quarter, consumers in the Northeast may have had difficulty getting to the mall, thanks to a series of winter storms that made driving hazardous.
