Fitch’s rating downgrade of the U.S. reflects “the expected fiscal deterioration over the next 3 years” and now our government has the same rating as Taiwan which is plagued by the threat of a military invasion. While there maybe merit to our government’s downgrade, things are looking much more stable for our private sector.
While all this may be true regarding our government’s finances, things are looking much more stable for our private sector. Notably, Yum! corporate recently characterized its operating environment as stable positive & past peak inflation with mid-single-digit sales growth in developed markets and widespread positive traffic this quarter. Management further reported that while value is rising in importance, it is notable that most of KFC’s growth was with low-income consumers during the quarter. Further, a return to normal is evident by an increase in individual meal occasions as post-covid party sizes subside.