Luxury brands send confusing economic signal

Buyers may be tightening their belts, but they’re still pumping cash into Hermes hand bags. Is demand for luxury goods somewhat recession proof or just a lagging indicator? The answer should be clearer later this year.

On Friday, Paris-based $10,000 Birkin bag maker said sales in the first half of this year were up 23% from the same period in 2021 and operating margins hit a record high. Demand is strong in all regions, even in China, which was stalled for several weeks during the second quarter. As soon as stores reopened, shoppers returned and Hermès sales in mainland China grew at a double-digit pace in June.