Economist Mark Zandi warned that while the U.S. economy is still growing at about 2%, driven by business investment and AI spending, weakening consumer finances and falling disposable income are flashing "yellow flares" that could signal underlying economic strain.
Consumer Weakness Sends 'Yellow Economic' On Sunday, in a post on X, Moody’s Analytics chief economist Zandi said recent economic data does not signal an immediate downturn but does raise caution flags about underlying weaknesses.
"The raft of economic data released last week isn’t sending off red flares, but it is sending off yellow ones," he wrote.
He noted that real GDP is still expanding at roughly a 2% annual rate, supported by artificial intelligence-related investment and corporate tax cuts that are boosting business activity.
However, he warned that consumer fundamentals are weakening.
