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April showers haven’t dampened spending yet 24 April 2025 Key takeaways •Consumer spending momentum was positive, but moderated, in March, according to Bank of America aggregated credit anddebit card data. But has increased economic uncertainty and the equity market sell-off dampened spending in April? It appearsnot so far. •Total card spending growth has remained robust over the first three weeks of April. Some of this strength reflects spending ondurables, which has also continued into this month. Auto loan applications and a proxy for purchases, highlights that vehicleswere a particular "buy ahead" focus. •The sell-off in equity markets appears to have had few "wealth effects" yet, with the top 5% of households showing no signs ofa pullback in spending. That said, it's early days, and these impacts are likely to come through slowly. Consumers showed some momentum heading into AprilAs discussed in ourApril Consumer Checkpoint, consumer spending growth showed positive momentum through the end of March, with credit and debit card spending up 1.1% YoY (year-over-year) in March. And the three-month seasonally adjustedannualized rate (SAAR) of growth was 1.8% (Exhibit 1). With measures of economic uncertainty rising significantly over the past few months amid the imposition of tariffs and theequity market sell-off, it makes sense to keep a very close eye on how the consumer is reacting. Exhibit1:Consumers continued to showmoderateforwardmomentum, with spending up1.8%on an annualized basisinMarch2025Total credit and debit card spending growth per household, based on Bank of America card data (monthly, month-over-month (MoM) %, seasonally adjusted (SA)) and (3-month moving average, SAAR, SA) But the sun is still shining through mid-AprilWhat do we see in April? So far, Bank of America card data through April 19 suggests that consumers are continuing to spend at a healthy rate, with spending up YoY throughout most of the month (Exhibit 2). In the week ending April 19, total card spendingper household was up 3.1% YoY, with the YoY partly being boosted by the later timing of Easter this year. Exhibit2: Consumer spending continued to growYoYfromthe beginning to the middle of April Total credit and debit card spending, based on Bank of America data (7- Total credit and debit card spending on durables*, based on Bank ofAmerica data (7-day moving average, index January 2024 average = 100) day moving average, index January 2024 average = 100) Two big questions Are consumers still “buying ahead” of tariffs?OurApril Consumer Checkpointfound evidence that consumer card spending on“durables”(proxied by spending on furniture, electronics, auto parts and building materials) had risen significantly in March, suggesting that consumers were bringing forwardsome spending on items where they thought prices might rise as a result of tariffs. And it appears that strong durables spendinghas continued over most of April so far (Exhibit 3), though the recent week of April 12-19 suggests some levelling off in the YoYrate of growth may now be in progress. However, an important caveat is that with Good Friday on April 18 (compared to March29 last year), the timing of Easter may have impacted sales. Exhibit5: A proxy for vehicle sales shows continued strength inAprilThe number of large* customer auto payments (weekly,2023=100) Exhibit4:Consumer vehicle loanapplications for Bank of Americaauto loans remained strong over AprilAverage daily consumer vehicle loan applications for different time periods (daily, YoY%) It could also be that for some products, consumers may feel they still have more time to“beat”any increase in price, especiallygiven the 90-day delay for countries (other than China) for the full reciprocal tariffs. Additionally, some electronics such assmartphones are subject to exemptions. But for autos, a 25% tariff has been in place since April 3 on imported vehicles, and we noted in the April Checkpoint that carsappear to show the most pronounced signs of“buying ahead”as consumers attempt to buy up vehicle inventory on dealers’lots.Bank of America internal data on consumer vehicle loan (CVL) applications showed a surge in loan applications at the end ofMarch as the auto tariffs were announced. Updating this data for the first three weeks of April it appears this surge hascontinued (Exhibit 4). More broadly, we see similar evidence looking at weekly data on the number of Bank of America customers making largepayments (above $2,000) to auto firms and vehicle finance providers as a proxy for vehicle sales. These large payments likelyreflect initial down payments on vehicles and showed a similar surge in late March. And while there appears to have been somepullback in April (data through to April 18), this sales proxy remains elevated (Exhibit 5). Is spending being impacted by the equity market sell-off?The ownership of equities is skewed towards households with higher incomes. In fact, the top 20% of hou