Higher interest could imply that consumers are more willing to spend Dan Dolan, director of wealth management services at State Street Global Advisors’ Sector SPDR Trust, said in an interview with Investor’s Business Daily.
Still, there are some catalysts for discretionary ETFs, such as XLY, including the rising minimum wage. Meanwhile, a growing segment of America is calling for higher minimum wages across the government after years of stalled efforts. The national minimum wage has been set at $7.25 per hour since 2009, and changes would require the support of the Republican-controlled Congress.
A number of research has pointed to improved economic conditions from higher wages. For instance, in a 2011 study by the Chicago Federal Reserve, the author found that for ever dollar increase in minimum wage, a worker’s household added $2,800 in new consumer spending over the following year.
Vanguard Consumer Discretionary ETF
Tom Lydon’s clients own shares of XLY.