Are you buying more things lately? Or doing your bit to combat inflation by ‘buying nothing’? In the US, where stimulus checks helped to fatten wallets through the pandemic, Americans have been spending money like it’s going out of fashun. US retail sales in January 2022 rocketed 25% ahead of the same period in 2020, before Covid took over our lives, and it makes for one helluva chart! 📈 Meanwhile, spending on services has only nudged up around 6%, and according to Bloomberg, the extra rush to spend on goods has been one of the big drivers of inflation since those initial lockdown add-to-cart shopping sprees began.
And while consumers have been makin’ it rain money, big box behemoths like Costco (COST) and Walmart (WMT) have been soaking it up. Costco Wholesale saw sales go ballistic this January, and not just for their legendary US$1.50 hotdog and soda combo! 🌭🥤 The company reported that comparable same store sales in the US exploded 9.5%. Not only is Costco the largest wine seller in the US, but the company continues to spread their low-cost wings globally. Costco is even set to land in NZ’s own West Auckland later this year, but if you’re after some of that sweet, sweet big-box wine, you’ll have to wait. Strict West Auckland liquor licensing means alcohol sales will be off the table. But you may pick up a diamond ring with your weekly shop. 💍
World’s largest retailer Walmart (WMT) also had a very merry Christmas, reporting their largest holiday season ever, growing comparable sales by 5.6%. Can all this spending hold? Walmart reckons, yep, and have forecast sales to grow modestly in 2022. But as the battle against inflation heats up, higher interest rates could still suck the fun out of the spending spree, seeing people channel spare cash into higher interest payments on mortgages. We might just settle for a $1.50 Costco hotdog. 😐