Tariff Concerns Drive Consumers to Cut Spending Plans

Recent data and company reports indicate growing uncertainty and caution among both American and Chinese consumers, largely driven by concerns over tariffs and economic outlook. Several luxury brands, such as Brunello Cucinelli, Moncler, Prada, and Hermès, reported mixed sales performances in China, with volatility in consumer spending and ongoing uncertainty expected in the coming months. In the U.S., consumer sentiment has dropped to near-record lows, with many anticipating worsening financial conditions and planning to cut back on discretionary spending, particularly on electronics and other tech products. Companies are warning that tariffs may force them to increase prices, which could further dampen consumer spending and complicate central bank efforts to manage inflation and employment. As a result, shoppers are increasingly seeking value, conducting more research, and demanding payment flexibility, while economic policymakers remain cautious about adjusting interest rates amid inflationary and growth-related risks.