If you're still timid about spending, you're not alone. Consumer confidence dropped 8.8 percent in February, while the nation's confidence increased 3.3 percent. That's according to the latest poll just released this morning by Siena College Research Institute (SRI).
The good news comes in the area of computers and home improvements. In February, more people planned to buy computers and make major home improvements. But buying plans were down for cars/trucks and homes. Furniture purchases remained unchanged.
There are several reasons for the dip in consumer confidence.
"Unfortunately, as we warned a month ago, Mideast turmoil as well as U.S. budget battles punctured the confidence balloon New Yorkers floated in January," said Dr. Doug Lonnstrom, professor of statistics and finance at Siena College and SRI Founding Director. "Confidence returned to the doldrums of late 2010 as consumers were more affected by the sudden price increases at the pump than by small gains on Wall Street or a drop in unemployment. Buying plans remain above recent demand rates especially for furniture, cars and home improvements for now. But with gas headed towards $4.00 and food prices now likely to increase, the willingness to spend seems likely to lessen for many state residents."
There continues to be major uncertainty with gas prices rising for the fifth consecutive month, and increasing sharply by the end of February. Sixty-two percent of all New Yorkers say current gas prices are having a very serious or somewhat serious impact on their financial condition. Sixty-four percent of New Yorkers say the money they spend on groceries is having either a very serious or somewhat serious impact on their finances. Forty-nine percent say both gas and food prices are having either a somewhat or very serious impact on their finances.
"Now with food prices set to escalate, the percentage of New Yorkers feeling pinched by both the pump and the checkout line, already flirting with fifty percent for the first time since 2008, is sure to move even higher," according to Dr. Lonnstrom.
Are soaring gas prices having an impact on your bottom line? Are you concerned about increased food prices? What are you doing without to make up for it? Leave your comments below.
