Consumer Finances Rebound After Pandemic Shock but Face New Challenges

Unemployment spiked early in the pandemic but has recovered to pre-pandemic levels. Wage growth now outpaces inflation after a period where rising prices erased pay increases.

Savings rates increased early in the pandemic due to stimulus money and fewer spending opportunities, but have dropped back down as spending resumed. Credit card debt is now swinging higher as families try to keep up with prices.

Grocery prices rose 25% over 4 years due to supply chain issues, extreme weather, and avian flu. But inflation is cooling and prices are expected to stabilize.

Home prices surged 48% due to high demand and low interest rates during the pandemic. But prices have dropped 11% from their peak as demand cooled amid rising rates.

Consumer sentiment dipped during peak inflation but is improving now that inflation is easing. Consumers feel inflation will "continue on a favorable trajectory."