Anthony Behar/Sipa USA/Getty ImagesĬonsumers still don't feel great about the economy, despite lower gas prices The national average price for a gallon of gas fell below $4.00 a gallon to its lowest level since March of 2022. Price of gas advertised at a service station in the Queens borough of New York City, NY, August 11, 2022. The Federal Reserve said earlier this month that consumers added $40.1 billion worth of debt to their balance sheets in June. It really makes for challenging times,” he said, noting that the amount of debt people are carrying on their credit cards has been creeping up. “It’s kind of a double whammy – you have less coming in, more going out. Higher prices on food and gas impact lower-income households to a greater degree, because they must spend a larger share of their earnings for these necessary purchases, said Mike Rittler, head of retail card services at TD Bank. “We expect inflation to continue to influence the choices that families make,” McMillon said. Retail sales at department stores, for example, dropped in the month of July and were also lower on a year-over-year basis.Įven wealthier Americans are being impacted by the highest inflation in 40 years: Walmart CEO Doug McMillon said Tuesday on the company’s investor call that higher prices were contributing to an influx of higher-income shoppers at the discount store. “It’s really those discretionary goods we’re seeing a lot of cutback on, particularly among those lower- and middle-income groups,” she said.
How does inflation affect my standard of living?Ĭonsumers have no choice but to buy essentials like groceries and gas, although they may switch to cheaper brands or change how frequently they buy, said Kayla Bruun, economic analyst at decision intelligence company Morning Consult.
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