Here's the downside to record-setting stock markets across the globe that are generating a wealth boom

Bank of America says the stock market wealth effect is boosting consumption among higher-income Americans, but that spending is also adding to inflation pressure. Lower-income consumers are reportedly missing out on the rally altogether, highlighting a growing divergence in household demand. The piece is commentary rather than a policy or earnings event, so near-term market impact should be limited.

Analysis

Bank of America says the stock market wealth effect is boosting consumption among higher-income Americans, but that spending is also adding to inflation pressure. Lower-income consumers are reportedly missing out on the rally altogether, highlighting a growing divergence in household demand. The piece is commentary rather than a policy or earnings event, so near-term market impact should be limited.