Chart of the Week
While the latest retail sales figures fell short of expectations and raised questions about the financial health of the American consumer, other figures describe an American economy that is still very dynamic. This is particularly true of the air transport data published by the Transportation Safety Agency. The number of people passing through security checkpoints reflects a peak in traffic. On June 23, a record 2,996,913 people took to the skies.
U.S. air traffic shows a clear seasonal pattern, with a low point at the beginning of the year, followed by a first peak at the beginning of summer and another at Thanksgiving. But in the third week of June, passenger numbers were up 6.0% year-on-year.
OUR ANALYSIS
After having shifted their consumption basket in favor of goods in the wake of Covid-19, American households are once again turning towards spending on services. Air transport represents around 2% of these services, and shows a certain cyclicality, with significant declines during recessions. Air traffic has a statistically significant correlation with total consumption.
Over twelve months, consumption of services excluding housing was up by 3.4% in volume, marking a notable acceleration since the summer of 2023, while consumption of goods was up by 2.0%.
Air traffic is just one indicator, but it shows that recent weakness in retail sales should not be over-interpreted. Although US households are no longer benefiting to the same extent from the tailwinds of recent years, it is undoubtedly too early to envision a trend reversal.
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Written on June 28, 2024. This is not an investment advice. Opinions subject to change.
See also: https://latribune.lazardfreresgestion.fr/en/nordics-escape-budget-concerns/
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