U.S. consumer attitudes toward the economy have continued their trend of pessimism and deterioration throughout the year, with no immediate sign of reversal. Aside from the continued slide of the housing market, other factors including job security – with the current unemployment rate standing at 5.5 percent – have left many households feeling vulnerable when assessing their financial situations.
With good reason, the issue of the rising cost of food and fuel has continued to make headlines. And now with gasoline prices above $4.00 a gallon nationally, many consumers are tightening budgets as a response.
How likely consumers are to dramatically reduce discretionary spending is still up in the air, but from the recently released consumer credit report by the Federal Reserve – known as the G.19 – it would appear that a possible slowdown may indeed be underway. In the Fed’s report detailing credit expansion in April, credit card debt grew at a mere 0.4 percent, down from the 7.4 percent annual growth rate seen in March and the 6.8 percent annual growth rate seen in the first quarter of 2008.
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