Real spending in February saw variations across sectors, with notable strength in cosmetics and sporting goods, accounting for the leap year adjustments. Despite this, investors remained cautious, refraining from taking large positions due to the absence of high-impact data releases. On Monday, gold traded in the red near $2,900, while the EUR/USD picked up fresh bids, trading positively near 1.0850.
The financial landscape was influenced by various factors, including the leap year effect, which made comparisons to the previous February challenging. Last February had one extra day, corresponding to 3.4% more days than this February. This temporal discrepancy was significant when analyzing consumer spending trends.
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In terms of spending patterns, travel spending remained subdued compared to last February, with nominal growth hovering around 0 percent. Although spending growth appeared muted in February overall, the restoration of purchasing power continues to form a robust foundation for private consumption in 2025. However, declining consumer confidence indicates a lingering hesitance among many to spend.
Real goods spending showed approximately zero growth since February last year when adjusted for the leap year effects. Danish card data revealed that spending, excluding energy, increased by just 1.5% in February year-on-year. Adjusting for inflation, however, spending excluding energy declined by 0.4% year-on-year, equating to around 3% growth when mitigating the leap year impact.
Consumer price inflation began strongly in 2025 but appeared to have cooled somewhat in February. In contrast, food prices rose by 5.7% year-on-year in February, adding pressure to household budgets and potentially influencing spending behaviors.
The modest real spending growth in certain sectors signals resilience despite headwinds such as inflation and consumer hesitancy. The increase in cosmetics and sporting goods reflects targeted consumer interest areas where expenditure remains robust. Yet, muted travel spending indicates areas where consumers continue to hold back.
As investors remain cautious without significant data releases to guide them, the financial market dynamics continue to reflect uncertainty. The performance of precious metals like gold and currency pairs such as EUR/USD provides insights into broader economic sentiments and investor strategies.