Consumer spending is resilient—for now—but a slowdown could be looming

The insight: The US economy ended 2024 on a high, thanks to resilient consumer spending that helped prop up Q4 growth.

• Consumer spending rose 4.2% year over year in Q4, an acceleration from the previous quarter, per US Commerce Department data.
• Overall, real GDP grew 2.3% YoY in Q4 and 2.8% in 2024.

But storm clouds are gathering. The economy is entering uncertain territory as the Trump administration’s policies rattle consumers and roil global markets, creating a highly volatile environment. The president’s latest promise to go through with Mexico and Canada tariffs, slap an additional 10% levy on Chinese imports, and introduce reciprocal tariffs in April will only heighten the unpredictability companies face.