Jewelry sales outperform as U.S. spending for most luxury goods falters, Citi report finds

Consumers are spending more on luxury jewelry while pulling away from handbags and clothes, according to a Citigroup analysis of credit card data

The run-up in gold prices is just one factor in play, according to Citi analyst Thomas Chauvet

Luxury spending decreased less than feared in May, but it's too early to say that upper-income consumers have reached a turning point, he said

Domenica Graci, the CEO and Founder of travel agency One Luxury, is seen wearing a golden Vintage Alhambra bracelet from Van Cleef & Arpels, a golden Love bracelet from Cartier, a golden Juste un Clou nail bracelet from Cartier and an Essential Lines bracelet from Cartier

Credit card spending on luxury goods fell during the first five months of the year compared with the same period in 2024, according to data from Citigroup

Combined spend for the top luxury brands, such as Hermès, even eked out a 0. 2% uptick on an annual basis, according to Citi's analysis of a subset of transactions by the bank's 10 million-plus U

However, these gains aren't equally distributed

Jewelry has ven to be a bright spot, consistently outperforming other leather goods and ready-to-wear

Monthly spend on luxury jewelry has increased on an annual basis each month since September, according to Citi

What's more, while other were buoyed by increases in average spend by customer, jewelry was the only duct type to also see an increase in individual customers

Citi analyst Thomas Chauvet told CNBC that sales have ly been buoyed by the perception of jewelry as investment pieces

Jewelry can also carry more sentimental value, he said, as a gift or to commemorate a life milestone. "When you have $3,000 to spend on luxury, you know, are you going to buy a piece of jewelry or a handbag for the same price. "Perhaps the piece of jewelry gives you superior intrinsic value given the precious metals content and superior emotional value and meaning. "Chauvet added that the recent run-up in gold prices vides further justification. "It is bably sensible to buy a Cartier bracelet now, given they have increased prices by less than 5% since the beginning of 2025, when gold prices have appreciated by over 25%," he said

Get Inside Wealth directly to your inboxThe Inside Wealth by Robert Frank is your weekly guide to high-net-worth investors and the industries that serve them

Here to get access today

Handbag brands, on the other hand, have steadily increased prices as much as 30% to 40% since the pandemic without the consumer getting more bang for their buck, he said. "Handbags have offered limited newness," Chauvet said, with the caveat that a few fall and winter 2025 collections showed some mise. "In the last five years, from brand A to brand B, most bags shapes and styles are very difficult to differentiate from one another. "Luxury watch spending has seen some gains this year, but less consistently than that of jewelry

While surges in Swiss watch exports have made headlines, Chauvet said it was largely driven by retailers stocking up and watch manufacturers rushing duct to U

The spending uptick in May may reflect an uplift in consumer sentiment but not necessarily a turning point for high-end shoppers, according to Chauvet

While equity have rebounded, the U

Dollar is down 10% year to date. "We know the U

Consumer feels better life when the dollar is strong," he said. "One example of that in luxury is your ability to travel and to spend abroad on luxury is augmented by a strong dollar. "Other potential threats to consumer spending loom large