US luxury spending is falling ahead of US midterm polls: What Citi’s data tells about wealthy shoppers turning cautious

US luxury credit card spending fell 6% year-on-year in September, marking a third consecutive monthly decline as economic uncertainty and the approaching midterm elections weigh on shoppers. 

US luxury spending fell for a third consecutive month in September, pointing to growing caution among American shoppers even as luxury brands continue to rely on the country's wealthy consumers to offset weakness in other major markets.

Overall US luxury credit card purchases declined 6% year-on-year in September, following 4% declines in both July and August, according to Citi. The data is based on millions of credit card transactions.

The slowdown comes as the US heads towards the November 3 midterm elections, with surveys from the Conference Board and the University of Michigan showing growing unease about the US economy.

Why US luxury spending matters

Buffeted by prolonged weakness in China and the economic fallout of the Iran war, luxury brands have pinned hopes on resilient demand from wealthy US shoppers, including a growing cohort of AI millionaires, to offset softer sales elsewhere and help lift the sector out of a prolonged downturn.

While continued wealth growth among affluent consumers supported the top-end of the market in September, overall US luxury credit card purchases fell 6% from a year earlier, after declining 4% in both July and August, Citi analysts said in a research note.

The luxury brands most exposed to the US include Tapestry , owner of Coach and Kate Spade; French conglomerate LVMH , known for brands like Louis Vuitton and Tiffany; and Italy's Ferragamo, they said.

The broader decline in spending suggests that even wealthy shoppers are becoming more cautious.

What are wealthy Americans spending less on?

Citi's data shows a mixed picture across luxury categories.

Spending on leather goods and ready-to-wear items improved sequentially in September. However, spending on watches and luxury jewellery deteriorated further.

Luxury brands have also raised prices this year. Most soft luxury brands selling apparel, shoes and leather goods increased prices by low single-digit percentages. That was slightly below the low to mid-single-digit price increases implemented by watch and jewellery makers.

What the midterm elections could mean

The spending slowdown comes against a backdrop of increased economic uncertainty. The run-up to US elections is often associated with greater caution among consumers and businesses, as political uncertainty can weigh on spending decisions.

Economists also point to rising US Treasury yields and mortgage rates as factors that could further cool economic activity.

The weakness could make it harder for luxury companies to deliver the recovery investors have been waiting for after two consecutive years of contraction.

Morgan Stanley analysts said in September that the downturn in US luxury spending leaves brands with little scope for the long-awaited return to growth.

What happens next?

The upcoming earnings season will provide a clearer picture of whether the weakness is spreading across the luxury industry.

LVMH, widely viewed as a bellwether for the sector, is scheduled to report third-quarter sales on October 12. Gucci owner Kering reports on October 22 and has already indicated that investors should expect a slowdown in the US market.

For luxury brands, Citi's September data suggests that the US consumer may no longer be an unlimited source of growth—even at the wealthy end of the market.

About the Author

Sanchari Ghosh is an Assistant Editor at Mint with over 12 years of experience in journalism, specialising in personal finance, DLT & DeFi, geopolitics and foreign policy, with a particular emphasis on how these areas intersect. <br> She writes extensively about how money works in everyday life—helping readers navigate personal finance decisions. <br> As AI reshapes investing behaviour, capital is increasingly flowing into decentralized ecosystems, redefining how assets are managed, traded, and valued. She focuses on explaining how money flows within frameworks like Distributed Ledger Technology (DLT), DeFi protocols, and crypto markets—while also exploring what the future of money could look like in a trustless, programmable financial world. <br> She also focuses on immigration-related issues, simplifying complex topics around visas, passports, overseas financial planning, and the many practical challenges Indians face while moving or living abroad. <br> Alongside personal finance, Sanchari has a strong understanding of international politics, contemporary and historical conflicts, and global state decisions. She closely tracks how geopolitical developments influence economies, markets, and individual financial choices, bringing together finance and global affairs in her reporting. <br> She began her career as a desk editor, which gave her a strong foundation in news writing. Over time, her interest naturally shifted toward personal finance. Before joining Mint in 2020, she worked DNA, The Times of India, Outlook Money, BloombergQuint, and ETMoney. At Mint, she got an opportunity to expand her coverage to include immigration and geopolitical developments while continuing to closely follow personal finance trends and market movements.As a journalist, she is committed to accuracy, intellectual rigour, and fairness. <br> She is an English Major and her work took her across cities including Delhi, Mumbai, and Pune. Living independently from an early age gave her firsthand experience in managing life and money on her own. This practical exposure sparked her strong interest in personal finance. <br> Outside the newsroom, Sanchari is a sports enthusiast who regularly plays lawn tennis and squash. In her younger years, she was also a national-level badminton player.

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