A woman rides an electric bike past a gas station on May 9, 2022 in Encinitas, California, as gas prices continue to climb to near-record levels.
Mike Black | Reuters
American households now spend the equivalent of $5,000 a year on gasoline, up from $2,800 a year ago, according to Yardeni Research.
Yardeni noted that the annual gasoline spending rate in March was $3,800. National gasoline retail prices hit a record $4.59 a gallon during the week of May 16, the company said.
“It’s no wonder consumer confidence is so subdued. It’s strange that retail sales were so strong in April and May,” Yardney said in a note.
Consumers, whose inflation-adjusted incomes have barely risen, Yardney said, have amassed large savings and are charging more and more for their credit cards.
But Yardney says don’t bet on American consumers: “When we’re happy, we spend money. When we’re depressed, we spend more money!”
Retail sales data for April released on Tuesday was surprisingly strong. Compared with a year earlier, retail sales rose 8.2% in the month.
Gasoline sales actually fell in April from March, as prices fell temporarily before rising to record levels in May. Gasoline spending jumped nearly 37% in April from a year earlier, according to Commerce Department data.
Gasoline was $3.04 a gallon a year ago, according to the AAA. The average price in all 50 states rose above $4 a gallon this week, according to the AAA.
The national average on Wednesday was $4.57 a gallon, according to the AAA website.