Consumers Reluctant to Boost Spending, Despite Falling Gas Prices

U.S. gasoline prices have fallen roughly thirty cents a gallon since February. But few consumers are pumping their savings back into the economy.

Eighty percent of Americans have held off increasing their discretionary spending in the first half of this year, despite falling gasoline prices. That’s according to a study by Princeton Survey Research Associates International.

Greg McBride is senior financial analyst with Bankrate.com.

“A lot people are still dealing with very tight household budgets. Their incomes are flat. Their other household expenses have crept higher. And as a result, even with the recent decline in gas prices, they just don’t have a whole lot of extra cash to throw around in order to ramp up their spending in other areas.”

The trend is a sharp contrast with 2011 and 2012, when nearly two-thirds of Americans cut back on non-essential spending as gas prices rose. A gallon of regular unleaded averages $3.41 in the Houston area, twenty-two cents less than at this time last year.

Bio photo of Andrew Schneider

Andrew Schneider

Business Reporter

Andrew Schneider joined KUHF in January 2011, after more than a decade as a print reporter for The Kiplinger Letter...