Consumer optimism falls with rising gas prices

Alexandria, Va. - Rising gas prices are taking a toll on consumer optimism about the economy. According to survey results released by the National Association of Convenience Stores (NACS), consumer optimism fell from 54% to 44%, the largest decrease in optimism since August 2014,



In the past month, gas prices rose 29 cents per gallon as refineries have begun the transition to produce the costlier summer-blend fuels that are required in many markets across the country. Consumers expect the upward trajectory of gas prices to continue, as three in four (73%) believe gas prices will be higher in 30 days than they are today, a noteworthy increase from 58% in February.



Weather may also play a role in consumer optimism. Consumer optimism was the lowest in the Northeast (37%), which has been battered by storms and cold weather in the past month.



With gas prices rising, consumers say they are more sensitive to the price at which they would change their behavior. The median fuel price consumers say they would try to reduce how much they drive is $3.50 per gallon, down from $4 at this time in 2014.



Similarly, the median price that consumers would seek out alternatives to drive is $4.14 per gallon, down from $4.70 in March 2014. Both of these figures are the lowest since NACS initiated the monthly consumer survey in January 2013.



There is some good news in the findings. Despite the rise in gas prices, nearly one in five (19%) consumers say that they will spend more money on consumer goods in the next 30 days, the highest level since December when holiday shopping surged.



Younger consumers are most likely to spend and drive more in March. Of those ages 18-34, 27% say that they will shop more in March and 28% say that they will drive more, significantly higher than the overall average of 17%.