Skift Take
Cash levels have stayed higher than many economists feared and that has supported a surge in travel. But the trend points to more traditional spending patterns.
New U.S. banking data from the JPMorgan Chase Institute, a think tank embedded within the country’s largest bank, suggests that households remain healthier than many economists feared. This could help explain why, in the face of higher inflation, travel spending has remained robust.
The study looked at cash balances, adjusted for inflation, held in checking and savings accounts across nine million Chase customers from January 2020 through March 2023.
In 2020 and early-2021, cash balances rose by a dramatic 80%+ above pre-COVID baselines as accumulated savings and government stimulus buoyed household balance sheets. But you already knew that – those "excess" savings fueled the revenge travel wave that our industry rode throughout 2022.
What’s most interesting is where we stand today. Cash balances remained elevated by 20-30% relative to 2019 through the first