Tags: welch | economy | gas

Welch: High Gasoline Prices Dampening Recovery

Wednesday, 28 March 2012 10:48 AM

The economy would be recovering at a faster clip were it not for high gasoline prices, says former General Electric CEO Jack Welch.

U.S. gross domestic product grew 3 percent on year in the fourth quarter, but keeping that pace will be a tough task thanks to rising fuel prices, which will crimp consumer spending elsewhere.

"It's not taking off. We're sort of relatively strong but not booming," Welch tells CNBC. "I am normally to one extreme or another, and I'm a little shaken about not knowing where this is going."

Gasoline prices are near $4 a gallon nationwide, many weeks before prices traditionally peak during the spring and summer driving season in the U.S.
Rising demand for oil worldwide as well as tensions involving Iran are sending prices up early this year.

A gallon of regular gas is averaging $3.91 a gallon, according to the AAA Daily Fuel Gauge, up 21 cents from a month ago, 32 cents from a year ago, and just 20 cents from its record high in July 2008.

Rising fuel prices are starting to make consumers uneasy.

The Conference Board reports that its closely watched consumer confidence index slipped to 70.2 in March from a revised 71.6 in February, mainly on fears that rising inflation rates will eat into household budgets.

"The biggest moving part in that scenario has been gasoline prices. So that's certainly on consumers' radar screen — or dashboard as the case might be," says Carl J. Riccadonna, director and senior U.S. economist of global markets research at Deutsche Bank Securities in New York, according to Reuters.

© 2021 Newsmax Finance. All rights reserved.

Wednesday, 28 March 2012 10:48 AM
Newsmax Media, Inc.
Newsmax TV Live

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

© Newsmax Media, Inc.
All Rights Reserved