JJ Kinahan, CEO of IG North America, joins BNN Bloomberg to discuss signals on consumer health from retail earnings.
The retailer now expects comparable sales to fall 3.5 to four per cent, versus the previous forecast of a two to three per cent decline. That is worse than the average analyst estimate compiled by Bloomberg. Lowe’s also expects adjusted earnings to come in lighter than it previously forecast. Americans have pulled back on discretionary spending amid high interest rates and inflation. They are holding off on making large purchases or taking on construction projects that need financing, prioritizing food and other essentials. When they are shopping, consumers are being selective and seeking value.
Within the home-improvement arena, Lowe’s and other operators have been navigating through a slowdown following the pandemic when consumers rushed to upgrade houses. Existing home sales remain muted, and consumers are focusing on smaller projects such as gardens.