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Regional Roundup: Upswing in spending eludes the South
Slower wage growth and a relatively weak tourism season appears to have restrained the southern economy.
September 2025
Key takeaways
- Total credit and debit card spending per household has strengthened in recent months, according to Bank of America aggregated data. All U.S. regions have seen an upswing, though spending growth in the South was weakest year-over-year (YoY) in August.
- One reason for the sluggish southern spending may be that the region's after-tax wages and salaries growth has decelerated, according to Bank of America deposit data. Contributing to this is the fact that average incomes tend to be lower in the region, and lower-income households have seen softer wage growth nationwide.
- Additionally, regional economies may have been impacted by a somewhat soft summer tourism season. International visits have declined this year, but we also find a softer picture for domestic tourism.
- Looking forward, higher- and middle-income households' spending growth is stronger than that of lower-income households. This may help support tourism given the higher discretionary spending of these cohorts. The fall in the U.S. dollar may also encourage international visitors to return to the U.S.
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