U.S. consumers in 'good shape' as wages grow: BofA CEO

[January 17, 2023]  By Lananh Nguyen and Noor Zainab Hussain
 
DAVOS, Switzerland (Reuters) - U.S. consumers are still in "pretty good shape" and their wages are growing even as the Federal Reserve continues to withdraw excess liquidity from the system, Bank of America Chief Executive Officer Brian Moynihan said on the sidelines of the World Economic Forum's annual meeting at Davos.  

People ride escalator at Saks Fifth Avenue in New York City, U.S., December 4, 2022. REUTERS/Jeenah Moon

"The consumers are spending, their wages are growing and frankly, there's still a lot of stimulus ... Social Security payments are going up at a high rate," Moynihan told Reuters.

"Things like that are going to add more fuel that they can use to spend," he added.

The U.S. economy could also enter into a mild recession later this year or next year, he said, adding that for the rest of the world, the bank has predicted growth.

Wall Street's biggest banks have stockpiled more rainy-day funds to prepare for a possible recession, while showing caution about forecasting income growth in an uncertain economy and as higher rates increase competition for deposits.

Moynihan said that for the first time in a long time deposits had come down a little bit for the industry.

(Reporting by Lananh Nguyen in Davos and Noor Zainab Hussain in Bengaluru; Additional reporting by Niket Nishant; Editing by Mark Potter)

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