Gas prices soaring, high inflation and higher interest rates - It all suggests that consumer spending will be down this summer, but Visa’s Chief Economist, Wayne Best, predicts a $287 billion pent-up summer spending spree, primarily focused around traveling and destination like businesses.

Consumers in the top 42% are beginning to travel once more after the initial Covid outbreaks and credit card adoption is at an all time high. Meanwhile, consumer prices have been moving up. The Consumer Price Index surged 8.6% during the 12-month period ending in May, according to a release from the Bureau of Labor Statistics last month. That’s the biggest increase in the closely followed metric since December 1981.

Inflation is at record highs, but so far the demand for both essential and non-essential goods and services has not slowed down. With an increase in credit card spending, and more debt, will delinquencies in payments increase? So far credit card companies havenot seen an increase in deliquencies and write offs, but expected those numbers to increase at a normal rate comparable to pre-pandemic, pre-inflation years.

* Source: Mastercard’s SpendingPulse, Bureau of Labor Statistics, Payments Dive