Goldman Sachs estimates equity gains will lift annualized consumption growth by 0.4 percentage points over the next year.
A sustained stock market rally is amplifying the wealth effect, driving consumption growth by 0.3 percentage points annually over the past two years. Goldman Sachs strategists attribute roughly 0.2 percentage points of that gain to AI-related equities, with Nvidia and Micron leading the charge.
The top income quintile captures nearly all of the wealth effect’s impact on spending, reinforcing economic disparities. The Dow Jones Industrial Average hit a record 51,562 yesterday, supported by strong earnings and AI infrastructure investments.
Analysts project the wealth effect will add 0.4 percentage points to consumption growth over the next year, fueled by continued AI stock outperformance.