Goldman Sachs Sees US Consumer Spending Slowing to 1% in H2 2026 as Oil Hits $89

Q: As household cash flow vanishes, which major retail giant is secretly bracing for a brutal second-half spending cliff?

Walmart. It is the retailer most clearly signaling concern about a second-half spending drop as the tax-refund cushion disappears and fuel costs keep squeezing shoppers. In the reporting tied to Goldman Sachs’ warning, Walmart was singled out as the company “most in focus,” with analysts saying a more cautious and promotional consumer backdrop could make further sales gains harder. Walmart’s own executives have reinforced that view. CFO John David Rainey said higher tax refunds had temporarily muted pressure from high gasoline prices, but that with those refunds now largely gone, consumers are likely to feel more strain. He also said lower-income shoppers are becoming more budget-conscious and in some cases are navigating financial distress, while higher-income customers remain more resilient. That matters because Walmart is a key read on the broad U.S. consumer. Its recent results were still solid, with strong same-store sales and e-commerce growth, but its guidance was cautious and it warned that persistent fuel inflation could force higher retail prices later in the year. Management has also pointed to signs of stress in fuel-buying behavior, including customers putting fewer gallons in their tanks. Taken together, Goldman’s macro warning and Walmart’s company-level commentary point to Walmart as the major retail giant bracing most visibly for a tougher second half if household cash flow fades and consumer spending slows toward the 1% to 1.5% range Goldman expects.

3 articles · Updated · Business Insider · Aug 17

1% real consumer spending growth in the second half of 2026 is now Goldman Sachs’ low-end forecast, down from the 2.5% annual PCE pace recorded in June.
Fading spring tax refunds and higher energy costs are expected to stall real cash flow, with Brent crude at $89 a barrel—about 22% above pre-Iran-war levels.
July retail sales fell 0.6%, though Goldman said an earlier-than-usual Amazon Prime Day likely pulled some spending into June rather than signaling a one-off collapse.
A drop to 1% would mark the weakest spending pace since early 2021, adding to broader Wall Street concern that inflation and fuel costs are squeezing households.