With gas prices down 31 percent since June 2014 and oil prices were around $85 a barrel, American Consumer Confidence has improved, going up 12 percentage points year over year, New York-based Nielsen reports.
In the market research firm’s report “Consumer Confidence: Concerns and Spending Intentions Around the World – Quarter 4, 2014,”it found that although overall consumer confidence declined 2 percentage points in the fourth quarter, Americans are feeling good again about their personal finances (up 6 percentage points) and immediate spending intentions (up 8 percentage points).
The percentage of Americans who felt it was a good time to spend also increased by 9 percentage points, it reports. U.S. shopping trips rebounded in November and December, increasing from 13 trips a month in June to 15 trips a month in December. Americans also have more money to spend on each of these shopping trips, as a result of cheaper fuel — spending at least a $1 more each trip, Nielsen reports.
Thirty-nine percent of respondents said they have more money to spend because of declining gas prices and are putting this money toward paying their bills (50 percent), everyday essentials like food (36 percent) and discretionary items like home entertainment (30 percent) and clothing (30 percent).
However, serious economic pressure is being felt by the world’s oil producers, and this is evident in the Q4 Nielsen Consumer Confidence Index. According to the report, Russia’s consumer confidence declined 8 percentage points, China and Japan each have decreased 4 percentage points, Saudi Arabia is down 3 percentage points, Canada’s consumer confidence declined 1 percentage point, and Venezuela remained flat.
Louise Keely, senior vice president for Nielsen, noted the significant year-over-year improvements for U.S. consumers. “Consumers appear more upbeat than other regions going into 2015,” she said in a statement. “Declining unemployment, falling oil prices and continued low interest rates place consumers in the world’s largest economy in a better position to spend than in recent years.”
The online survey was conducted from Nov. 10 to 28, 2014.