Gasoline prices have risen so high that they are now forcing consumers to cut back at the pump and elsewhere, economists say.
The summer driving season, when gasoline prices are at their highest, is still several weeks away, and already national per-gallon averages have hit $3.83, not far from the record high $4.11 reached back in 2008, according to AAA.
A per-gallon price of $3.83 is close the point where consumers cut back on fuel-related activities, which means less driving to the mall, to restaurants and other entertainment venues that ultimately could mean less economic growth.
|Gasoline Prices Starting to Crimp Consumer Demand
Stock prices are already feeling the effects, experts say.
"I am sure the rising cost of energy is bothering the market," says Fred Dickson, chief investment strategist at D.A. Davidson in Lake Oswego, Ore., according to the Christian Science Monitor.
"I do think the uptick in gasoline prices will have an impact on consumer spending in the next few quarters."
Demand for gasoline last week dropped 1.6 percent from year-ago levels, , MasterCard's weekly data shows, according to Reuters.
Many Americans are cutting back on driving especially on weekends.
"People still have to drive their kids to school, they have to go to work but we're seeing cutbacks primarily in shopping trips and as people decide not to take that weekend trip," says John Gamel, director of economic analysis for MasterCard Advisors SpendingPulse, which uses purchase data to determine national demand, according to Reuters.
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