Walmart and Target earnings to reveal if US shoppers are breaking under inflation.

Two of America’s largest retailers will publish their quarterly earnings this week, offering a critical snapshot of the U.S. consumer’s financial health. The reports from Walmart and Target are expected to show how everyday shoppers are coping with persistent price increases. Analysts will scrutinize same-store sales and profit margins for signs of strain. The key question is whether customers are still spending freely on general merchandise or cutting back to essentials only. In recent months, inflation has eaten into household budgets, forcing many to trade down to cheaper brands or delay non-essential purchases. Walmart, known for low prices, may benefit from this shift, while Target, which relies more on discretionary goods like home decor and clothing, could show more weakness. The results will also guide expectations for the upcoming holiday season. If consumer spending is faltering now, retailers may need to offer steep discounts later in the year to lure cautious shoppers. Both companies are set to release their numbers before the market opens. Investors and economists will be watching closely for any change in spending behavior, as consumer outlays remain the primary engine of U.S. economic growth.