American Express Reports 9% Increase in Consumer Spending Around Thanksgiving
News Summary
American Express Chairman and CEO Stephen J. Squeri announced on December 10 that consumer spending around Thanksgiving increased by 9%, with Platinum cardholders showing a 13% rise. For the fourth quarter to date, Amex's billings growth was similar to Q3's 8.5%, with strong continued spending on goods, services, and retail, and an uptick in travel and expense (T&E) in Q3. Mastercard reported a 4.1% growth in retail sales (excluding auto) on Black Friday (November 28) and 3.3% on Cyber Monday, despite economic uncertainty and higher prices. Michelle Meyer, chief economist at the Mastercard Economics Institute, noted that consumers are showing incredible savviness by shopping early, leveraging promotions, and investing in wish-list items. Visa indicated that during this year's holiday season, 47% of Americans used AI tools for shopping, 20% were excited to receive cryptocurrency as a gift, and 20% preferred digital wallets. The National Retail Federation (NRF) reported a record 202.9 million consumers shopped during the five days from Thanksgiving through Cyber Monday, up from 197 million in 2024 and 200.4 million in 2023. NRF President and CEO Matthew Shay stated this reflects highly engaged consumers focused on value and promotions. A PYMNTS Intelligence report also found that 151 million consumers made at least one purchase on Black Friday.
Background
The current period is late 2025, specifically around the Thanksgiving to Cyber Monday holiday shopping season in the United States. Under the administration of President Donald J. Trump (re-elected in November 2024), the U.S. economy is navigating a period characterized by "economic uncertainty and higher prices," making consumer spending data a critical indicator of economic health and consumer confidence. Major payment networks like American Express, Mastercard, and Visa, alongside industry bodies such as the National Retail Federation, routinely publish consumer spending reports. These reports offer vital real-time insights into retail performance and broader macroeconomic trends for investors and policymakers.
In-Depth AI Insights
Beyond the headline numbers, what does sustained consumer spending, particularly among affluent cardholders, truly indicate about the underlying economic resilience in late 2025, especially under the Trump administration? - The strong growth in spending among high-end consumers (13% for Amex Platinum cardholders) suggests that the wealth effect remains significant and that higher-income households are less sensitive to inflation. This provides underlying support for luxury goods and travel sectors. - The robust overall consumer spending (9% for Amex, 4.1% for Mastercard) might reflect continued labor market resilience and a relatively optimistic consumer outlook on future income, even amid "uncertainty." This could imply that current expectations of an economic slowdown are overblown, or that the market underestimates the economy's structural adaptability. - This resilience could also be a synergistic effect of specific economic policies under the Trump administration (e.g., tax cuts, deregulation, or targeted industry support) stimulating spending in particular areas, thereby offsetting other adverse factors. Given the reports of "economic uncertainty" and "higher prices," how are consumers adapting their purchasing behavior, and what structural shifts does this signal for the retail sector in 2026 and beyond? - Structural shifts in consumer shopping behavior are accelerating. For instance, early shopping and leveraging promotions have become standard, forcing retailers to kick off holiday sales earlier and optimize discount strategies, potentially compressing profit margins and altering inventory management models. - Technology's role in shopping is intensifying. Visa's report of 47% of Americans using AI for shopping and 20% preferring digital wallets indicates that retailers must significantly invest in digital transformation and personalized AI-driven shopping experiences or risk obsolescence. The rising acceptance of cryptocurrency as gifts also hints at future diversification of payment methods. - This savvy consumer pattern may lead to decreased brand loyalty, with consumers prioritizing value and experience, driving retailers to innovate in product differentiation and customer engagement rather than just price competition. What are the second-order implications of major payment networks and retail groups consistently reporting strong holiday spending data for broader market sentiment and Federal Reserve policy expectations? - Consistently strong consumer spending data could bolster the Federal Reserve's confidence in a soft landing and potentially reinforce its stance of maintaining "higher for longer" interest rates to ensure inflation is fully contained. This might lead to further delays or a weakening of market expectations for rate cuts in 2026, impacting bond yields and valuations. - Market sentiment could oscillate between "soft landing" optimism and "inflationary pressure" concerns, leading to differentiated sector performance. Consumer discretionary and high-end consumer goods companies might fare well, while interest-rate-sensitive growth companies could face valuation pressures. - Given the Trump administration's likely propensity for fiscal stimulus to support economic growth, if the Fed continues to maintain a hawkish stance due to strong consumption, this could lead to a potential conflict between fiscal and monetary policies, increasing macroeconomic uncertainty and having complex effects on the U.S. dollar.