Morning Market Tidbits: Is the K closing?

Research evidence excerpt

Morning Market Tidbits: Is the K closing?

Accessible version

Morning Market Tidbits

Is the K closing?

Key takeaways 18 June 2026

Economics• The gap in total card ex-gas spending between higher- and lower-income households

United States

has narrowed in recent days.

• Today's events: initial claims, Philly Fed business outlook, leading index and TIC flows. Shruti Mishra

US Economist

BofAS

smishra44@bofa.com

US Economics

What Matters Today: The gap in total card ex-gas spending between higher- and lower-income BofAS

households has narrowed in recent days See Team Page for List of Analysts

Total card ex gas spending per HH by income group (y/y % change of the 7-day MA of spending levels)

10% Lower Higher

8%

6%

4%

2%

0%

-2%

-4%

-6%

Oct 25 Dec 25 Feb 26 Apr 26 Jun 26

Source: BAC internal data

BofA GLOBAL RESEARCH

A potential narrowing in the K…

The K-shaped nature of consumer spending has been persistent since late-’24/early-’25.

However, BAC aggregated debit and credit card data for the first half of June show the

gap in total card spending ex-gas between higher- and lower-income households

narrowing. Alongside this, a recent Bank of America Institute report showed a rise in

after-tax wage growth for lower- and middle-income households. It is still too early to

confirm a sustained shift, as the recent improvement could partly reflect tax relief, but

the data bear watching.

…likely due to recent broadening in job growth

However, if this narrowing of the K is sustained, one explanation could be job growth

broadening into more blue-collar sectors such as leisure & hospitality, construction and

manufacturing. Recent data provide some tentative evidence of this, alongside an

improvement in professional & business services hiring after job losses throughout ‘25,