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BANK OF AMERICA CORPORATION

(BAC)
  Report
Delayed Nyse  -  04:00 2022-10-03 pm EDT
31.09 USD   +2.95%
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Bank of America Payments and Spending Data shows Consumers are not Wilting in the Summer Heat

08/09/2022 | 07:03am EDT

Total payments increased 7% year over year in July; Consumers feel relief from lowering gas prices but many are feeling squeezed from rising rents

NEW YORK, Aug. 9, 2022 /PRNewswire/ -- The Bank of America Institute published a new article today which shows consumer spending continues to increase in July but some consumers are feeling the effects of rising rents. Bank of America internal data suggest median rent payments increased by 7.4% year-over-year in July. That said, there are many reasons to remain positive about the steady resilience of US consumers: lower gas prices provided some relief to consumers in July, and promotional events from retailers boosted spending on goods. Additionally, households' deposit and savings balances remain elevated and consumers have not yet shown signs of increased borrowing.

Highlights of the publication:

  • Bank of America total payments increased 7% year over year in July, roughly in line with June's data; this figure offers a holistic view of money flow and includes credit card, debit card, Automated Clearing House, wires, bill pay, person-to-person, cash and checks.
  • Card spending per household increased by 5.3% year over year, down from 5.7% in June.  With US Consumer Price Index inflation at 9.1% in June and Personal Consumer Expenditure (PCE) inflation at 6.8%, it appears "real (inflation-adjusted) spending" continues to be under pressure.
  • According to internal Bank of America data, all income groups are feeling the impact of higher rents, with the biggest rent increase seen by those households with income between $51,000-150,000.
  • Younger consumers are getting squeezed the most by higher rent inflation with median payment up 16% year over year in July for Gen Z, compared to just 3% for Baby Boomers.
  • As oil prices fell throughout July, average gas spending as a share of total card spending per household fell to 9.3% in June for lower-income households (<$50k per year), down from a peak of nearly 10% in June.

"Our internal spending and payments data suggests consumers are not wilting in this summer heat," said Anna Zhou, economist for the Bank of America Institute. "While wallets are getting squeezed for the 34% of US households who are renters, relief from lower gas prices and retail promotions encouraged consumers to continue to spend throughout July."

About the Consumer Checkpoint

Consumer Checkpoint is a regular publication from the Bank of America Institute. It aims to provide a holistic and real-time estimate of US consumers' spending and their financial well-being, leveraging the depth and breadth of Bank of America proprietary data. Such data is not intended to be reflective or indicative of, and should not be relied upon as, the results of operations, financial conditions, or performance of Bank of America.

See the Consumer Checkpoint for methodology and definitions.

About the Bank of America Institute

The Bank of America Institute is dedicated to uncovering powerful insights that move business and society forward. Established in 2022, the Institute is a think tank that draws on data and analyses from across the bank and the world to provide timely and original perspectives on the economy, Environmental, Social and Governance (ESG), and global transformation. The Institute leverages the depth and breadth of the bank's proprietary data, from 67 million consumer and small business clients, 54 million verified digital users, $3.8T in total payments in 2021 and $1.4T in consumer and wealth management deposits. From this robust data set, the Institute provides a unique perspective on the health of the economy. It also elevates thought leadership from throughout the bank that addresses long-term trends and shares these findings with the general public.

Bank of America

Bank of America is one of the world's leading financial institutions, serving individual consumers, small and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving approximately 67 million consumer and small business clients with approximately 4,000 retail financial centers, approximately 16,000 ATMs, and award-winning digital banking with approximately 55 million verified digital users. Bank of America is a global leader in wealth management, corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to approximately 3 million small business households through a suite of innovative, easy-to-use online products and services. The company serves clients through operations across the United States, its territories and approximately 35 countries. Bank of America Corporation stock (NYSE: BAC) is listed on the New York Stock Exchange.

Reporters may contact:

Melissa Anchan, Bank of America     
Phone: 1.646.532.9241
melissa.anchan@bofa.com

 

Cision
View original content to download multimedia:https://www.prnewswire.com/news-releases/bank-of-america-payments-and-spending-data-shows-consumers-are-not-wilting-in-the-summer-heat-301602399.html

SOURCE Bank of America Corporation


© PRNewswire 2022
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