Deep Dive on Auto, Home, and Big Ticket Demand; Current Spend Holding Pattern Steady; NFL Meeting Thursday: Macro Monday on Sunday

By David Schick and Jonathan Feeney and David Katzman and Jack Hermann Published on June 14, 2026 PDF

Summary: (1) Autos, homes, and durable goods are sensitive to consumer perceptions of buying conditions and the selling, shipping, financing of these categories employ lots of Americans, in Chart of the Week we show that despite the K-shaped narrative consumers are feeling quite uneasy about big ticket spend; (2) our measurement of Consumer Velocity decelerated to +2.4% y/y T4W, with T12W holding at +2.5%, marking the eighth consecutive week of T4W running below T12W and the underlying trend remains modestly soft relative to its post-2022 average, see Fig 1; (3) Housing activity continues to be impacted by higher borrowing costs with 30Y FRM at 6.52% (-35 bps y/y T4W) and home prices flat y/y, though precursor metrics show some positive inflection, see Fig 3-6; (4) Gas prices have retreated from highs, but gas inflation remains the dominant macro signal at +50% y/y T4W, see Fig 7; (5) Sentiment moved higher m/m after hitting all-time lows (44.8) last month, we note lower-income Sentiment is still down -17% y/y while higher-income Sentiment decreased -2% m/m and -19% y/y, see Fig 9-12; (6) the Wealth Effect Index measured +16.4% y/y, increasing for the 12th consecutive week off of a strong market finish last week, see Fig 13-16; and (7) Optimal’s David Katzman will host a discussion on the NFL Economic Ecosystem with PE’s entry on Thursday 6/18 Register Here.

Chart of the Week: Buying Conditions for Large Ticket Items, 1979-2026

Source: Optimal Advisory Analysis, University of Michigan Survey of Consumers

Our Consumer Velocity tracker softened from last week, with the T4W down to +2.4% y/y from +2.8% the prior week, while the T12W trend also decelerated to +2.5% y/y (from +2.8%). The underlying trend remains modestly soft (0.3 standard deviations below the post-2022 average on both a T4W basis and 0.4 standard deviations on a T12W basis). The T4W vs. T12W inflection was −0.1 pts, the eighth consecutive week of shorter-term growth lagging longer-term. The gap has compressed sharply from its early-May trough (around −1.5 pts) and is now close to flat. See Fig 1-2.

Home mortgage rates continue to move higher but we note some y/y activity in early metrics. US 30Y FRM rate is up to 6.52%, running down -35 bps y/y on a T4W basis but at the highest levels since last September (0.6 standard deviations below average since 2020). MBA’s mortgage applications for purchase index is running up +3% y/y while refinance applications index is running up +20% y/y. Median home prices are flat y/y. Roughly 18% of US GDP is related to the selling, building, fixing, lending to, and furnishing of homes – velocity matters for the economy. See Fig 3-6.

Gasoline inflation is decelerating but remains elevated, with the latest weekly print up +37% y/y (down from +47%), the T4W now at +50% y/y, and the T12W at +57% y/y. The T4W trend is 0.9 standard deviations above average, and the T4W vs. T12W inflection has flipped to −6.8 pts (from +1.4), with the shorter-term pace now running well below the longer-term trend. We continue to flag that utilities (electricity and heating fuel) run about 9% of lower-income household spending vs. 4% for higher-income households, compounding the squeeze at the bottom of the income distribution. See Fig 7-8.

Sentiment ticked up off last month’s all-time low (44.8) to 48.9, but it remains the second-lowest reading on record and the y/y decline steepened to -19% this month. Overall, headline Sentiment is down -19% y/y this month alone and down -13% on a T3M basis (1.1 standard deviations below average) and -19% y/y on a T9M basis (1.8 standard deviations below average). Upper-third income Sentiment is down -7% y/y on a T3M basis (0.6 standard deviations below average), after declining -1% y/y T3M last month. Middle-income Sentiment is down -16% y/y on a T3M basis (1.2 standard deviations below average) after declining -11% y/y T3M last month, and lower-income Sentiment has declined -18% y/y on a T3M basis (1.5 standard deviations below average) compared to -15% last month, although lower-income Sentiment is up +29% m/m. See Fig 9-12.

Consumer “Wealth Effect” continued momentum. Optimal Advisory’s Wealth Effect Index is at +16.4% y/y (0.6 standard deviations above average since the start of 2022 and higher for 12 consecutive weeks). Strong market rally to close last week continues to drive equity returns higher, shrugging off conflict in the Middle East and higher energy prices. With home prices flat y/y and despite headwinds from lower crypto prices we note the “flywheel” of wealth effect turning higher. See Fig 13-16.

Our Multifactor Macro Market Model has been suggestive of March 2026 softness, rebound. Optimal’s Multifactor Macro Market Model projects the S&P 500 as well as bull and bear cases based on lagged data for 12 macroeconomic factors. The model suggested the S&P 500 to fall to just below 6000 by March, before rebounding back up to 6400 by May. We use this model as a guide to how macro would guide the market, given our analysis of current variables. This is, of course, outside of other factors at work. See Fig 17-18.

Figures 1-2: Optimal Advisory Consumer Velocity Monitor

Source: Optimal Advisory Analysis, Bloomberg Second Measure

Consumer Spending y/y Relative to Historical Average

Source: Optimal Advisory Analysis, Bloomberg Second Measure

Figures 3-6: Housing Kinetic Energy

Source: Optimal Advisory Analysis, Freddie Mac, Zillow, Redfin

Mortgage Rates, For Sale Inventory, & Median List Price y/y Relative to Historical Averages (Since 2020)

Source: Optimal Advisory Analysis, Freddie Mac, Zillow, Redfin

Figures 7-8: Gas Prices y/y

Source: Optimal Advisory Analysis, Bloomberg

Gas Prices y/y Relative to Historical Averages (Since 1992)

Source: Optimal Advisory Analysis, Bloomberg

Figures 9-12: Consumer Sentiment T3M and T9M y/y

Sentiment y/y by Income Tercile Relative to Historical Averages

Comparison of Sentiment y/y Across Income Terciles

Source: Optimal Advisory Analysis, University of Michigan Consumer Survey

Figures 13-16: Consumer Wealth Effect & Components y/y

Source: Optimal Advisory Analysis, Bloomberg, Zillow, Redfin

Median Home Price y/y, S&P 500 y/y, & Wealth Effect Index (Since 2022)

Source: Optimal Advisory Analysis, Bloomberg, Zillow, Redfin

Figures 17-18: Optimal Advisory Multifactor Macro Market Model

Historical Test Predictions vs. Actual (On Test Data Only)

Source: Optimal Advisory Proprietary Analysis, Bloomberg, FRED, BLS, BEA, OECD, University of Michigan Consumer Sentiment Survey, U.S. Census Bureau, FRB

Actual & Projected S&P 500 (Including Training & Test Data) with Confidence Intervals

Source: Optimal Advisory Proprietary Analysis, Bloomberg, FRED, BLS, BEA, OECD, University of Michigan Consumer Sentiment Survey, U.S. Census Bureau, FRB

Figure 19: Index & Sector Performance

Source: Optimal Advisory Analysis, Bloomberg, prices at market close 6/12/2026

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