This is a decision many are making today…
Retail sales in the U.S. have increased slightly in April but rising gasoline prices are cutting into discretionary spending.
Retail sales rose 0.3 per cent last month after surging on 0.8 per cent in March
This excludes automobiles, gasoline, building materials and food services.
Consumer spending slowed down in the first quarter; it is rising, but at the slowest in almost 5 years. The slower rate of spending is being blamed on delays in processing tax refunds, the two back-to-back hurricanes late last year and higher gasoline prices.
Gas prices have risen about 31 cents per gallon this year. if this trend continues it will affect the way lower income consumers spend.
Gasoline prices are almost $3.00 per gallon and are likely to remain elevated for a while
With consumer spending amounting to two-thirds of the U.S. economic activity, it is important for these gas prices to go down.
The effect of this shows up in auto sales, which edged up in April 0.1 percent after it had risen 2.1 percent in March. Sales at restaurants fell 0.3 percent, the largest drop in over a year.
There is also a big cut back on spending for Americans on their hobbies, personal grooming, health and personal care stores, but there is increased spending at furniture stores, building material stores, clothing and online retailers.
When gasoline prices subside, will you be buying a new toy?