“Despite the buffer of excess savings, rising gas prices nevertheless appear to weigh on real consumption,” US economist Peter McCrory, JPMorgan, wrote in the report.
The bank found that the impact of high gas prices on consumer consumption takes time to accumulate and traction is not clearly evident until two to three months after the gas price rise.
“This means that growth in real consumer spending may be erratic in the coming months,” JPMorgan said.
Consumer spending is the key driver of the US economy.
The problem is that gasoline is an important purchase for many Americans.
Demand for the pump does not tend to fall, at least not initially when prices rise, JPMorgan said. But that means some families are forced to retire on other expenses to make ends meet and avoid diving into savings or taking on debt.
Every $ 1 in additional gasoline consumption after a price increase lowers non-gas consumption by $ 1.60, according to JPMorgan’s estimates.
Pump prices were already rising on the way into February, when Russia’s invasion of Ukraine caused them to rise even higher. The war and sanctions have put pressure on the energy supply from Russia, the world’s largest exporter of oil.
Pain at the pump is not felt all over the country.
JPMorgan said high gas prices impose “greater difficulties” on families less able to adjust their consumption.
Chase map data shows that consumers in Arkansas and Missouri have increased their gas station spending the most since February, while spending in Connecticut, Massachusetts and New York has increased the least.