US Consumers React to Gas Prices and Mortgage Fears

26 April 2007

NEW YORK: Consumer confidence in the US has fallen as rising gasoline prices and mortgage pressures take their toll on spending. The Conference Board's index of consumer confidence fell to 104.0 this month from 108.2 in March. The index averaged 105.9 last year.

The number of consumers who say jobs are plentiful has declined, while the proportion that plan to buy a house is the lowest in more than two years.

Warns economist Douglas Porter, from BMO Capital Markets: "The run-up in gas prices is the biggest near-term drag on the consumer. There was some further deterioration in plans to buy homes and appliances, which suggests the weakness in the housing sector is not going to go away."

The Board's measure of present conditions fell to 131.3 from 138.5. The gauge of expectations for the next six months fell to 85.8 from 87.9.

Data sourced from Bloomberg (USA); additional content by WARC staff