Rising Gas Prices Don't Deter Consumer Optimism
ALEXANDRIA, Va. -- U.S. consumers continue to feel optimistic about the economy, despite a sharp increase in gas prices over the last month and consumer expectations that prices will climb higher over the next 30 days, according to the latest NACS Consumer Fuels Survey, which examines how gas prices affect consumer sentiment.
Nearly nine in 10 consumers, or 85 percent, say gas prices affect their feelings about the economy, yet optimism is rising even as gas prices are.
Sixty-eight percent of consumers noticed that gas prices increased in the past month, with 22 percent saying prices are "much higher." At the same time, 59 percent of consumers expect prices to increase over the next 30 days, the highest percentage since July, according to NACS, the Association for Convenience & Fuel Retailing.
Gas demand typically rises in the spring, putting more pressure on the fuels system as it transitions to summer-blend gas.
Nearly half of consumers, or 44 percent, are optimistic about the economy despite high prices and the expectation of future increases. This is a steady increase from the 43 percent that said the same one month ago, and a sharp jump from the 35 percent who expressed optimism in October, when consumer sentiment last bottomed out.
However, consumer sentiment is not uniform across the country. The Northeast, coming off a harsh winter, expressed the lowest optimism about the economy at 39 percent, while the West was the most optimistic at 47 percent.
Consumer miles per dollar decreased in March, falling 3.9 percent to 6.92 miles per dollar. NACS added this metric to its survey this year to gauge how consumer perceptions about their self-reported mileage and gas prices might also affect their moods.
"The latest increase in consumer optimism is great news for convenience stores and other retailers who saw slim sales as the harsh winter weather in early 2014 kept consumer spending in check," said NACS' Vice President of Government Relations John Eichberger. "That fact that consumer optimism continues to increase while every other metric that we track related to consumer optimism trended down is a positive indicator for retailers, who typically see stronger sales inside the store as the weather heats up and daylight hours increase."
NACS partnered with Penn, Schoen and Berland Associates LLC to survey 1,089 gas consumers from March 4-6. Alexandria, Va.-based NACS, founded in 1961, has 2,100 retailer and 1,600 supplier member companies, which do business in nearly 50 countries.