June 2022 / VIDEO
Consumers are Financially Strong, But Inflation Looms
Key Insights
- Pandemic-related stimulus combined with a robust labor market have resulted in consumer balance sheets that are stronger than before the pandemic.
- Consumers are releveraging, with aggregate credit card debt recently rising above pre-pandemic levels.
- However, if inflation stays elevated, consumers will need to lean more heavily on their savings to fund purchases, reducing average checking account balances.
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Pranay Subedi is a corporate credit analyst in the Fixed Income Division. He is an Investment Advisory Committee member for the Government Money Fund and Reserve Investment Funds. He also is an Investment Advisory Committee member of the Corporate Income Fund, Summit Funds, and U.S. Treasury Funds and chair of the Money Market Credit Committee. Pranay is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price Associates, Inc.
