This story was originally published on Retail Dive. To receive daily news and insights, subscribe to our free daily Retail Dive newsletter. Dive Brief: The Home Depot on Tuesday reported fourth quarter sales fell 3.8% year over year to $38.2 billion. The fourth quarter of the retailer’s fiscal year 2025 included 13 weeks compared to the year prior, which included an extra week and added about $2.5 billion in sales. Comparable sales increased 0.4%, while U.S. comps inched up 0.3%. The home improvement ...

Core Viewpoint - Ford Motor Company reported a significant loss of $11.1 billion in Q4 2025, primarily due to one-time special items related to its electric vehicle strategy, but adjusted earnings showed a profit of $0.13 per share, which was below Wall Street's expectation of $0.19 per share [1][2][3] Group 1: Earnings Performance - Ford's reported loss was largely attributed to unexpected additional tariff costs of approximately $900 million, which affected its earnings guidance [6][8] - The company's adjusted EBIT for 2025 was revised down to $6.9 billion, missing both Wall Street's and its own guidance of $7 billion [8] Group 2: Market Reaction - Despite the earnings miss, Ford's stock did not decline significantly; it saw a slight increase in after-hours trading and continued to rise modestly the following morning [2][5] - The market's positive reaction is attributed to the understanding that the tariff costs were outside of Ford's control and that the company could absorb these costs without major operational impacts [9]

House lawmakers could vote as soon as later this week on whether to reject some of President Donald Trump’s tariff policies, ahead of a midterm election focused heavily on anxiety over the US cost of living https://t.co/R9AdXSLIR3 ...

Employment Trends - December saw a sluggish addition of only 50,000 jobs, a slight decrease from the revised figure of 56,000 in November [1][4] - The unemployment rate decreased to 4.4%, marking its first decline since June, down from 4.5% in November [1] Business Hiring Behavior - Businesses appear reluctant to hire despite economic growth, with many companies no longer needing to fill additional positions after aggressive hiring post-pandemic [2] - Factors contributing to this reluctance include uncertainty from shifting tariff policies, elevated inflation, and the impact of artificial intelligence on job roles [2] Sector Performance - The majority of job gains in December were concentrated in the health care sector, which added 38,500 jobs, and the restaurant and hotel industries, which gained 47,000 jobs [5] - Conversely, manufacturing, construction, and retail sectors experienced job losses, with retailers cutting 25,000 positions, indicating weaker holiday hiring compared to previous years [6] Federal Reserve Response - Weak employment figures have raised concerns at the Federal Reserve, which cut its key interest rate three times last year [3] - Some Federal Reserve officials are worried about persistent inflation above the 2% target, while others advocate for lower borrowing costs to stimulate hiring and economic growth [3]

Core Insights - Nearly half (49%) of U.S. adults reported being worse off financially in 2025, primarily due to unexpected expenses [1] - Economic challenges such as high inflation, tariff policies, a prolonged government shutdown, and rising unemployment have significantly impacted household finances [1] - Two-thirds (67%) of respondents indicated that economic conditions affected their spending habits [1] Regrets and Action Steps - The top regret among Americans in 2025 was not saving enough money, with nearly four in ten (38%) expressing this sentiment [4] - More than one in four (28%) Americans regretted making impulse purchases driven by emotions [6] 2026 Action Steps for Saving Money - Build a budget to identify available savings [8] - Set up automatic transfers from checking to savings accounts after each paycheck [8] - Start small with savings, even $25 per paycheck can accumulate to $650 annually for biweekly earners [8] 2026 Action Steps for Reducing Impulse Purchases - Implement a 24-hour cooling-off period before making non-essential purchases over $50 [9] - Track impulsive buying patterns to understand triggers [9] - Use cash for discretionary spending to limit overspending [9]

Group 1 - Social Security is a crucial source of retirement income for millions, and understanding its rules and changes is essential for retirees [1] - In 2026, Social Security benefits will receive a 2.8% cost-of-living adjustment (COLA), which is slightly higher than the 2.5% increase in 2025, but may not significantly help due to rising costs [2][3] - Medicare Part B costs are increasing, which will reduce the impact of the COLA on retirees' monthly benefits [3] Group 2 - Tariff policies may contribute to rising prices, potentially causing the 2.8% COLA to lag behind inflation, although they could also lead to lower inflation if they slow down spending [4] - Retirees relying heavily on Social Security should consider backup plans, such as reducing expenses or seeking part-time work, in case the COLA does not provide sufficient support [5] Group 3 - Seniors can now earn more income without risking withheld benefits once they reach full retirement age, allowing for greater financial flexibility [6] - The earnings-test limit for those under full retirement age has increased to $24,480 in 2026, up from $23,400 in 2025, meaning that earnings above this threshold will result in $1 in benefits being withheld for every $2 earned [8]

Economic Growth and Consumer Behavior - The GDP growth rate is reported at 4.3%, which is better than expected, indicating resilience in consumer spending despite concerns about wage growth and economic disruptions [2][3][11] - Consumer spending remains strong, although it is uneven, with the top earners driving most of the spending, reflecting a K-shaped recovery [4][11] Investment Trends - Investment has been robust, particularly in AI, which continues to support economic growth, although there has been a slight weakening in overall investment during the quarter [3][12] - There is an expectation for capital spending to become a growth engine next year as financial conditions ease and uncertainty diminishes, broadening investment beyond just AI leaders [12] Policy Impacts - Tariff policies are viewed as problematic, contributing to increased costs for consumers, which affects affordability in essential areas such as healthcare and housing [5][6] - The interaction of various policies, including immigration and tariffs, complicates the economic landscape, making it challenging to forecast future outcomes [7][8] Labor Market and Employment - The labor market has shown signs of weakening, with slower wage growth particularly affecting lower-income workers, which could impact overall consumer spending [4][11] - There is a concern that employment slowdowns may hinder investment growth, although potential Federal Reserve easing could mitigate some of these effects [13]

Economic Growth - The US economy grew at an unexpectedly strong pace of 4.3% in the third quarter, marking the highest rate in two years [1][6] - This growth rate represents an increase from 3.8% in the previous quarter and surpassed analyst expectations of 3.2% [2] Consumer Spending - Vigorous consumer spending on services such as health care and products like recreational vehicles contributed significantly to the GDP surge [1] Employment and Retail Sales - The jobs market has faced challenges, with unemployment rising to 4.6% in November, the highest level in over four years [4] - Retail sales have slowed, even as upper-income households continue to spend, leading to weaker-than-expected earnings and outlooks from major businesses like Home Depot [4] Inflation and Price Trends - Inflation remains a concern, hovering above the Federal Reserve's 2% target, although consumer prices rose only 2.7% year-over-year in November, a smaller-than-expected increase [4][5] - The inflation data may be distorted due to challenges in data collection during the recent government shutdown [5] Tariff Impact - Businesses are uncertain about how much of the tariff costs to pass on to consumers, complicating the assessment of the full impact of tariff policies on prices [7] - The average annual rate of economic growth since President Trump's return to office is 2.5%, comparable to the 2.4% average recorded last year under former President Biden [7]

Global Economic Outlook - The global economic growth outlook is bleak, with the IMF projecting a slowdown in 2026 due to rising protectionism and prolonged uncertainty [1][10][27] - Global economic activity is expanding modestly, primarily driven by the services sector, but tariff pressures are constraining trade and manufacturing [12][34] China - China's economic growth is losing momentum, with manufacturing contracting for seven consecutive months, the longest period in over nine years [42][44] - Retail sales growth is significantly below pre-pandemic levels, and GDP growth is expected to slow from 4.8% in 2025 to 4.4% in 2026 without substantial stimulus measures [1][42] - The real estate slump and oversupply issues continue to pose challenges, with recovery efforts expected to take time [44][51] United States - The U.S. economy is projected to grow moderately at 2.1% in 2026, slightly up from 2.0% in 2025, supported by fiscal expansion and service sector activity [2][21] - Labor market slowdown and various risks, including political uncertainty and tariff impacts, are expected to cloud the economic outlook [21][27] - The Federal Reserve is anticipated to lower the federal funds rate to a range of 3.25%-3.50% amid sticky inflation and economic headwinds [21][27] Eurozone - The Eurozone is expected to continue its recovery with modest GDP growth of 1.1% in 2026, supported by fiscal policies and an expanding service sector [28][30] - However, persistent weaknesses in manufacturing and external demand due to geopolitical tensions may weigh on overall growth [28][34] Japan - Japan's economy shows potential for recovery, bolstered by fiscal stimulus and strong service sector activity, despite challenges from weak manufacturing and global demand [3][35] - The government has introduced a JPY 21.3 trillion stimulus package to address inflation and promote growth [3][37] - The Bank of Japan is expected to cautiously normalize its monetary policy as inflation remains above the target [38][41] Thailand - Thailand's economic growth is projected to slow to 1.8% in 2026, the lowest in five years, due to the impact of U.S. tariffs and global trade tensions [3][52] - The tourism sector is recovering but has not yet returned to pre-pandemic levels, and domestic political uncertainties may affect public spending [3][52] - Stimulus measures and growth in emerging industries may provide some support to the economy [3][52]

Financial Performance - Costco Wholesale reported an 8.2% increase in net sales for Q1 of fiscal 2026, totaling $65.98 billion, up from $60.99 billion in the same quarter of the previous year [1] - Comparable sales increased by 6.4% across the business [1] - Net income rose from $1.79 billion to $2 billion, marking an 11.7% year-on-year increase [1] - Total revenue reached $67.31 billion, which included $1.33 billion from membership fees [2] - Operating income increased to $2.46 billion from $2.20 billion in 2024 [2] - Income before income taxes was reported at $2.58 billion, with a tax provision of $582 million [2] Sales Growth - The company recorded sales gains of 5.9% in the US, 6.5% in Canada, and 8.8% in other international markets [1] - Online sales experienced significant growth of 20.5% [1] Warehouse Operations - At the end of the quarter, Costco operated 923 warehouses globally, including 633 in the US and Puerto Rico, 114 in Canada, and various locations in other countries [2][3] - The company maintains e-commerce platforms in multiple countries, including Australia, Canada, Japan, Korea, Mexico, Taiwan, the UK, and the US [3] Legal Actions - In early December 2025, Costco filed a lawsuit against the US administration to pause tariff collections and recover import duties paid under recent global import taxes, reflecting ongoing legal challenges related to tariff policies introduced in 2025 [4]