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Ultra-rich fueling sales of luxury brands despite inflation and recession fears

2022-08-14 10:14:04       source:CNBC

August 13, 2022

Prices for food, gas and travel have soared over the past year –  but the rich appear to be shrugging it off and are still fueling sales at luxury companies, where sneakers can go for $1,200 and sports cars easily top $300,000.

Companies that cater to the ultra-rich, including Ferrari and the parent companies of Dior, Louis Vuitton and Versace, are reporting strong sales or hiking their profit forecasts. The upbeat results come even as recessionary fears hang over the economy, with Walmart, Best Buy, Gap and others slashing their financial outlooks, citing a pullback in spending among lower-income consumers squeezed by inflation.

The unflagging strength in the luxury category is in line with past economic slowdowns, experts say, with the rich often being the last to feel the effects because of the cushion their extreme wealth provides. Among the jet set, the continued spending also signals how pricey purchases often serve as status symbols.

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