Inflation running at 3.2% — above target, Fed holding rates steady
Services inflation remains stubborn. Energy and food costs are the daily squeeze. Rate cuts have been pushed back repeatedly.
▲Shelter costs up 5.1% year-over-year
▲Grocery prices up 4.3% — protein and produce leading
→Fed funds rate held at 4.25–4.5% — no cut signaled
Interest rates
⚠ Elevated
Mortgage rates at 6.8% — refinancing and new purchases under pressure
Variable-rate borrowers and new buyers are the squeeze point. Fixed-rate holders are insulated. Credit card APR averaging 22%.
▲30-year fixed mortgage: 6.8% average nationally
▲Credit card APR: 22% average — 40-year high
▼HYSA and CD rates still favorable — 4.5–5.0%
Tariffs & prices
🔴 Escalating
New tariff rounds pushing consumer goods prices higher — electronics, apparel, appliances
Import costs passing through to retail. Big-ticket purchases now cost 10–20% more than 18 months ago. Not yet reflected fully in CPI.
▲Electronics: 15–25% price increase since Q3 2025
▲Appliances: 18% average price increase
→Auto prices stabilizing but still elevated
Recession signals
⚠ Watch
Leading indicators mixed — consumer spending softening, credit stress rising
Not a recession call, but the buffers are thinner. Credit card delinquencies hit a 12-year high. Savings rate remains low.
▲Credit card delinquency rate: 3.2% — 12-year high
▲Personal savings rate: 3.4% — well below historical avg
→GDP growth still positive at 1.8% annualized