Fuel costs have been increasing significantly after this last two months of global conflict. Consumers could not have planned for this and are reporting highly negative sentiment. The consumer in America makes up large volumes of debt through credit cards, rent, student loans and personal loans. The American consumer, however, is a legendary creature in terms of its will to buy.
At what point is the consumer totally tapped from a single variable perspective, just looking at what they pay at the pump. The $4+ national average per gallon is dramatic, but at this point the system seems to be creaking, not failing.
The Fed also had an interesting week and there is significant debate to drop or raise interest rates. Dropping rates would relieve some debt pressure, through refinancing and other means, but then may also lead to inflation in energy and oil. Dropping rates also seems likely due to the cost of national debt service.
My guess is $7-8 per gallon. What is yours? And why?
What $/gallon at the pump would result in US recession if sustained for any period of time?
byu/AMCorBUST2021 inAskEconomics
Posted by AMCorBUST2021