Bank of America (BAC) Consumer Checkpoint says consumer spending showed solid resilience in January, with total card spending +2.6% Y/Y, strongest in nearly two years, despite weather‑related disruptions

• Income‑based divergence in spending and wage growth persists, BofA said, and it said it was concerned that a “K” shape is opening up between higher-income households and middle-income households, alongside the existing gap with lower-income households.
• BofA says households remain adaptive and financially stable overall in the face of significant affordability challenges, supported by trading‑down behaviours, elevated savings and “dry powder” to borrow. 
• Moreover, BofA thinks higher tax refunds may provide a significant support for consumers.

Bank of America's Consumer Checkpoint suggests consumer spending is showing notable resilience, with a year-over-year increase despite weather disruptions. However, the divergence in spending power across income levels remains a concern, indicating potential economic inequalities, which could influence retail performance and overall growth outlooks. This resilience may support a more optimistic view for consumer-related equities, though the widening income gap could present challenges for broader economic stability.