October 2023 Economic Outlook: Potential Consumer Pullback Ahead

Last Updated: November 7, 2023


The October 2023 Economic Outlook report offers valuable insights into the current state of the economy and consumer behavior trends. Financial professionals should take note of potential headwinds that could impact consumers in the late months of 2023 and early 2024. This summary concisely overviews the U.S. Economic Outlook: October 2023.


5 Key Findings in October 2023
  1. Potential Consumer Pullback: There are indications of a potential consumer spending pullback in the coming months. Consumer confidence and spending expectations have declined, signaling a potentially bumpy ride for consumer spending in the year’s fourth quarter.
  2. Factors Influencing Consumer Behavior: Several factors contribute to the anticipated pullback, including higher interest rates, depletion of consumer savings, reduction of government benefits (i.e., SNAP benefits), and the resumption of student loan repayments. These factors may hinder the consumer’s ability to spend during the year’s final months.
  3. Consumer Confidence Decline: Consumer confidence experienced a significant decline in September and October after a robust rebound in the summer. Higher interest rates, reacceleration in gas prices, the resumption of student loan repayments, and geopolitical concerns contribute to this decline.
  4. Spending Expectations: Consumer spending expectations have dropped below last year’s levels, indicating a hesitancy to spend. Consumers plan to reduce spending across various categories, particularly in discretionary areas such as sporting goods, home furniture, dining out, decorative home furnishings, and home improvement supplies.
  5. Impact on Businesses: While these trends affect overall consumer spending, businesses should analyze their specific demographic and industry segments to understand how these consumer mentality and spending shifts would impact them. Each company will be affected differently, and understanding correlations to economic themes is crucial.




This summary highlights the potential challenges ahead for consumer spending. While consumers feel apprehensive and anticipate reducing spending, the strength and resilience of the labor market may help mitigate any pullback. Financial professionals should closely monitor consumer confidence, spending expectations, and labor market indicators to navigate these changing economic dynamics effectively in the coming months.


Read the full report in the U.S. Economic Outlook Report: October 2023.