NEW YORK —
Holiday spending surged in 2024, blowing past expectations and outpacing customer purchases over the gift-buying season last year, according to data released on Thursday by Mastercard SpendingPulse, which gauges in-store and online retail sales.
The end-of-year flex of consumer strength marks the latest indication of resilient U.S. buying power, which has kept the economy humming despite a prolonged stretch of high interest rates.
Gross domestic product grew at a solid 2.8% annualized rate over three months ending in September, the most recent quarter for which data is available.
The labor market has slowed but proven sturdy. The unemployment rate stands at 4.2%, a historically low figure.
The increase in holiday spending coincided with an initial bout of relief for borrowers, as the Federal Reserve cut interest rates by a total of one percentage point over the final few months of the year. However, interest rates still stand at a historically high level of between 4.25% and 4.5%.
"We think the economy is in a really good place," Powell said, later adding: "Growth of consumer spending has remained resilient."