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In a recent statement, a top economic adviser to President Trump expressed optimism about the future of the U.S. job market, despite ongoing concerns over rising prices linked to tensions with Iran.
Kevin Hassett, during an interview with Maria Bartiromo on Fox Business, shared insights from a meeting with a leader from one of the nation’s largest banks. “Credit card data indicates remarkably high spending levels,” Hassett noted, highlighting the surge in consumer expenditures.
“While gasoline prices are up, consumer spending has increased across various sectors,” he added, suggesting a broader economic resilience.
Hassett forecasted a “robust and stable employment landscape” for the remainder of the year, maintaining a positive outlook.
According to a report from the Commerce Department, consumer spending saw a 1.7 percent rise in March from the prior month. This uptick was largely driven by increased fuel expenses, with gas station sales alone jumping 15.5 percent from February to March.
The effective closure of the Strait of Hormuz since the beginning of the conflict between the U.S. and Iran at the end of February has sent global energy rates skyrocketing. The average cost of a gallon of standard gas in the U.S. was over $4.50 on Wednesday — over a dollar more than a year ago, according to AAA.
Gas prices in the U.S. reached the highest cost per gallon in four years at the end of April, when the price spiked to $4.18.
A study from the New York Federal Reserve published on Wednesday found that these increased fuel prices are particularly having a negative effect on low-income households.
The report found that households earning less than $40,000 a year increased their spending on gasoline the least out of all income bracket groups, indicating that these consumers are buying less fuel to avoid the higher costs.
“Higher-income households have reduced real gas consumption only modestly and increased gasoline spending considerably compared with 2023,” the Fed researchers wrote in the report.
“In contrast, lower-income households increased spending by much less and decreased real consumption by much more, potentially by carpooling or substituting to public transit where available.”