Resilient consumers have started to balk at some prices, experts say.
The combination of inflation and high interest rates has put a squeeze on consumers, who bear the burden of elevated prices but face expensive borrowing costs if they want to take out a loan to ease the financial pain, said Konik, of Jefferies.The resistance toward high prices, Konik added, has particularly manifested for two sets of goods: in-store food and big-ticket purchases such as cars and boats.
Simeon Siegel, a retail analyst at BMO Financial Group, echoed the observation about consumer intolerance centered on big-ticket items and durable goods, tracing the current reluctance back to a pandemic-era wave of purchases for items like exercise bikes and couches. Consumers will spend on high-priced essentials for the foreseeable future, Siegel said. "People spend on items they need," he added.
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