By Arlenys Tabare
According to the latest consumer survey published this Friday by the University of Michigan, The consumer confidence index fell to 48.2, one of the lowest levels in 74 years, mainly influenced by the increase in energy prices due to the prolonged war in Iran.
In this regard, Joanne Hsu, director of the survey, pointed out that 30% of those surveyed mentioned gasoline prices as one of the main factors of distrust about the current economy, while others pointed out the high tariffs.
“Consumers continue to feel affected by the pressure of prices for food and goods, but mainly by the skyrocketing prices at gas stations,” said the economist.
The conflict in the Middle East began on February 28; Since then, with the closure of the Strait of Hormuz, through which nearly 20% of the world’s crude oil transits, Oil prices have risen to over $100 per barrel. and those of gasoline up to $4.50 per gallon.
On the other hand, The “Current economic conditions” indicator also showed a 9% drop in the University of Michigan report since the beginning of May until reaching 47.8 points. This is due to concerns surrounding the personal finances of American consumers; Currently, high prices have left them unable to save.
Many economists believe that it will be impossible to regain consumer confidence if prices continue to rise. “It is amazing that developments in the Middle East will significantly boost confidence until supply disruptions are fully resolved and energy prices come down,” Hsu noted.
Keep reading:
- 115,000 jobs were created and unemployment remains stable in April
- Rising gasoline prices put more pressure on low-income Americans, report highlights
- Job offers and hiring in the US were maintained before the impact of the war
- Analysis reveals that one in five retirees in the US is looking for work due to economic need
