U.S. economy's K-shaped gap narrows

America's K-shaped economic gap is narrowing from the bottom up, with lower- and middle-income Americans catching up. Bank of America data shows spending and wage growth converging across income groups since May. Lower-income household spending grew 5.4% year over year, and after-tax wages rose 5.2% in July, surpassing higher-income wage growth for the first time since December 2024.