We Are So Back

Consumer sentiment seems to be bouncing back from April lows

Summary: The economy has remained resilient and markets have rebounded since liberation day. There's growing enthusiasm that we are back to where we were in terms of outlook for dealmaking activity at the beginning of the year. Capital markets are open and rate cut expectations are rising.

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Macro

The consumer is in good shape
"So the U.S. consumer is in a in a great place here that we continue to we see the U.S. consumer as a source of strength in the economy. The unemployment rate remains low and stable, Job creation remains healthy. Real wages are, of course, growing steadily. Consumer debt servicing burdens remain stable and near prepandemic levels. In our card portfolio, we're seeing improving delinquency rates and lower delinquency entries, and payment rates are improving on a year-over-year basis....on the whole, I'd say the U.S. consumer is in really quite good shape." - Capital One Financial (COF 0.00%↑) CEO Richard Fairbank

"The economy is still humming. Our guests are more employed. They have healthy balance sheets and household incomes that continue to strengthen. Each month, David, we run internal research on our guests that point towards more optimism on travel intent and less concerned about economic worries than both last year and even last month." - Wyndham Hotels & Resorts (WH 0.00%↑) CEO Geoffrey Ballotti

Spending remains resilient
"Overall, the U.S. business did a very strong job in coming back from a slower start in Q1 and getting sequentially better in Q2, getting some good revenue growth. Share was good and profit was good. So really getting better. And I think that's in the context of a pretty resilient overall consumer. The aggregate spend is holding up. Yes, there's some pressure in those with lower incomes where we're targeting some affordability and some special focus on marketing and occasions. So I think the overall outlook continues to be resilient, and we're investing for growth in that." - Coca-Cola (KO 0.00%↑) CEO James Quincey

"In the U.S., consumers and lenders remain sound and resilient, supporting stable lending activity. Consumers are benefiting from low unemployment, modest to positive real wage growth, and manageable inflation." - TransUnion (TRU 0.00%↑) CEO Christopher Cartwright

"North America was hit by a high level of inflation due to the trade war here. And the North American market has been pretty resilient in the first quarter 2025 and in the second quarter here with only a decrease of 1%." - AB Electrolux (ELUXY) CEO Yannick Fierling

"More broadly, although macroeconomic uncertainty persists, the U.S. economy continues to demonstrate solid fundamentals as the labor market and consumer spending remain resilient." - Nasdaq (NDAQ 0.00%↑) CEO Adena Friedman

Corporations are also spending
"I'll start with the corporate, which we saw in Q2, May was the worst. And so then June was better than May. July is better than June, and August is off to a strong start, even though it's kind of good for corporate. So good inflection in Q2 for corporate." - Southwest Airlines (LUV 0.00%↑) COO Andrew Watterson

Sentiment has improved
"Consumer sentiment in June improved from low levels earlier in the year, reflecting a better outlook for the economy, inflation, and personal finances...Major lenders reported solid second quarter earnings with strong profitability, adequate capital and good credit performance." - TransUnion (TRU 0.00%↑) CEO Christopher Cartwright

"We've seen our customer confidence feedback stay high levels and probably get fractionally better versus where we would have been in April. And that certainly -- that trend has continued since early July. So we feel really good about it." - United Rentals (URI 0.00%↑) CFO Edward Grace

"On the consumer products and more general merchandise and toy side, I would say we share a similar sentiment with our retailers, which is cautious optimism. Optimism in that consumer sentiment seems to be bouncing back from April lows. The consumer tends to be continuing to buy. And we don't see much evidence of pull forward buying, anticipating inflation or tariffs." - Hasbro (HAS 0.00%↑) CEO Christian Cocks

Everyone is getting used to this environment
"I think broad-based, people just get more used to that this is a new environment, and it's probably going to last for some time. So let's just get on with it and do what makes sense today because if it makes sense, in also over the long term, it doesn't help to wait for another month or 2." - ABB (ABBNY) CEO Morten Wierod

Rate cut expectations are rising
"Over the next several quarters, we expect the Fed to finally lower interest rates, which is desperately needed for the capital markets of our industry." - Alexandria Real Estate Equities (ARE 0.00%↑) Founder Joel Marcus

Many industries are expecting a boost from lower rates
"In terms of the economy, the backdrop remains favorable with resilient growth. We see inflation remaining muted with the likelihood for an increase in goods inflation but decelerating wage, energy, and shelter inflation. These factors should give the Fed room to lower interest rates over time, which is positive for asset values." - Blackstone (BX 0.00%↑) CEO Stephen Schwarzman

"We all are, you know, waiting for interest rates and whatever will happen from the FED to happen, you know, obviously in the second half of this year, there are a lot of jobs where the math works with that next, small interest rate decline. Uh, so we've bid them, we're waiting to hear our team is, is prepared." - Otis Worldwide (OTIS 0.00%↑) CEO Judith Marks

We all know where at least one guy stands on this
"I'd love for him to lower interest rates," - US President Donald Trump

"Once Chairman Jerome Powell is gone, and that's a matter of when, not if, and as soon as interest rates come down by 50 or 75 basis points, the automotive sector will take off again. Demand is there. But this Fed Chairman will not act. So we need a new Fed Chairman appointed as soon as possible." - Cleveland-Cliffs (CLF 0.00%↑) CEO Lourenco Goncalves

International