The president's proposed budget would put all discretionary spending at $1.7 trillion, down from $1.83 trillion in the current fiscal year, and increase defense spending by 13%, the official said.

The rebound indicates that core consumer spending remains steady even amid softer discretionary activity. Tariff pressures and federal spending cuts are contributing to cautious consumer behavior.

The president's proposed budget would put all discretionary spending at $1.7 trillion, down from $1.83 trillion in the current fiscal year, and increase defense spending by 13%, the official said.