By Nathalie Voit
Americans are spending over $2,000 more this year than last year to fill up their tanks, new data released May 20 from global investment company Yardeni Research found.
According to the new report, the annual rate of U.S. household spending on gasoline shot up to $5,000 a year in May as nationwide average gas prices reached a record $4.59 per gallon last week. Yardeni said that this was up from $3,800 in March and $2,800 just one year ago.
“No wonder that the Consumer Sentiment Index is so depressed. The wonder is that retail sales have been so surprisingly strong during April and May,” the firm wrote in a note, according to CNBC.
While inflation-adjusted incomes have barely budged, Yardeni cautioned not to bet against the American consumer: “When we are happy, we spend money. When we are depressed, we spend even more money!”
Yardeni also noted consumers were benefiting from an excess of savings accumulated throughout the pandemic.
The findings are supported by strong retail sales data for April, released last week. According to a Commerce Department report, retail spending in April rose 0.9% over the month and 8.2% on a one-year basis. Year-over-year, spending at gas stations rose almost 37.0% as gas prices surged 43.6% in the twelve months leading to April. This was despite a slight decline in gasoline sales from March to April as pump prices temporarily fell last month.
As of May 24, the national average for a regular gallon of gas is $4.60, according to the AAA website.
