For the first time in two years, a majority of Americans are optimistic about the economy, thanks to the continuing slide in gas prices.
A survey of gas consumers found that 57% of Americans are optimistic, including nearly two-thirds (65%) of those ages 18-34.
The levels of consumer optimism are the highest measured in the more than two years that consumer sentiment has been measured by the National Association of Convenience Stores (NACS). Consumers are obviously pleased with the continued falling price of gasoline. Almost nine in ten consumers (88%) say gas prices are lower today than they were last month, and they report that gas prices are 50 cents per gallon lower than they were 30 days ago.
Looking forward, consumers are evenly split about where gas prices will go from here. Nearly one in three (31%) say gas prices will be lower next month, which also is the largest percentage recorded. However, an equal number (31%) expect gas prices to go up over the next month. There is an interesting regional split when it comes to expectations of price: those in the Northeast are more likely to expect gas prices to fall (37% expect prices to go down vs. 21% who expect prices to go up), while those in the Midwest expect gas prices to go up (43% expect prices to go up versus 22% who expect prices to go down).
It remains to be seen if lower gas prices will result in more spending or driving. One in four consumers (24%) say that they will drive more this month, significantly higher than the 19% who said so each of the previous three months. However, only 16% of consumers say that they will spend more (excluding gas purchases) this month, while 25% say that they will spend less.
“Consumers generally pay down expenses in January after holiday spending so it’s not surprising that they may not shop more as gas prices fall. But if consumers do, in fact, travel more this month it would be a significant departure from previous years when January travel tended to fall off after the holidays and as winter weather keeps people indoors more,” said Jeff Lenard, NACS’ vice president of strategic initiatives.
NACS, which represents the convenience store industry that sells 80% of the gas sold in the country, conducts the monthly consumer sentiment survey to gauge how gas prices affect broader economic trends. The NACS survey was conducted by Penn, Schoen and Berland Associates LLC; 1,108 gas consumers were surveyed Jan. 6-8, 2015.