By Arlenys Tabare
According to the report recently published by the University of Michigan, the Consumer Confidence Index so far in April fell to 49.8 from Fifty three.3 in March, representing one of the lowest historical levels of this yearthis is due to several factors, mainly the development of the war in Iran, which has had consequences on the country’s economy in recent weeks.
In this regard, Joanne Hsu, director of Consumer Surveys, commented that the conflict in the Middle East has been the strongest influence on consumer opinion due to fluctuations in prices, especially gasoline.
The war that began on February 28 with the bombing of Iran by the United States and Israel has caused the closure of the Strait of Hormuz, through which nearly 20% of the world’s crude oil transits; This resulted in higher energy prices.
In recent weeks, the price of oil has continued to fluctuate above $100 per barrel, while gasoline at American pumps remains above $4 per gallon.
For Grace Zwemmer, American economist at Oxford Economics, The impact of the war will be felt mostly by low- and middle-income American households, since a large part of your budget goes to gasoline.
Months before the war, Americans were already struggling with high prices for food, goods and services, not only because of high inflation, but also in part due to the imposition of higher tariff rates that were already beginning to be reflected in consumers’ bills.
Now many specialists believe that the geopolitical conflict will have such an impact on consumers that they will reduce their expenses exponentially. According to the survey, regarding inflation, Americans believe it will rise to 4.7% this month; It is currently above 3%. Inflation expectations for the next five years increased to 3.2%.
For her part, Heather Long, chief economist at Navy Federal Credit Score Union, commented that “the outlook will not improve until the Strait of Hormuz is opened and the conflict is definitively ended.”
Keep reading:
- US business activity rebounds in April amid higher prices due to war in Iran
- Will the price of gasoline drop below $3 per gallon this year? This is what the experts say
- The war between the United States and Iran will not only increase the price of gasoline; other products will also increase in price
- Manufacturing production in the US decreased 0.1% in March
