June spending trends: ways to support member financial wellness needs.

By the Co-op SmartGrowthTM Team

Despite a strong jobs report for June, most other economic indicators are pointing directly toward an economic slowdown. Co-op’s June credit union card portfolio data showed flattening month-over-month results across most categories in both credit and debit, with a continued shift away from debit spending as consumers seek to hold on to the cash they have in their deposit accounts in anticipation of the “rainy day” that’s almost here.

June showed unexpectedly strong job gains of 372,000, keeping unemployment at a low 3.6%, identical to May’s level. Wages also climbed by 5.1% on an annualized basis. However, other economic indicators are not as encouraging. Retail sales slowed by 0.3% in May, and consumer sentiment fell to its lowest level in 70 years. In perhaps the biggest news, inflation jumped up to a 9.1% annual rate in June, hitting a new 40-year high.

The bond market is now in a yield curve inversion, a sign that bond investors are predicting an impending economic slowdown. Meanwhile, in an effort to combat rising inflation, the Federal Reserve raised its benchmark lending rate by three-quarters of a percentage point at its June meeting, and Fed watchers expect additional rate hikes later this year.