Consumer sentiment dipped to its lowest point in decades amid rising inflation and a decline in living standards, according to a Wednesday (Nov. 24) report from MarketWatch.
Based on the University of Michigan’s evaluation of consumers’ views, the final November reading of 67.4 – down from October’s reading of 71.7 – underlines the ongoing impacts of the economic downturn in the wake of the pandemic.
A barometer of consumers’ feelings related to current conditions dropped more than four points in November to 73.6 from 77.9 in October, according to the report. Meanwhile an index of expectations dipped to 63.5 this month from 67.9 last month.
The analysis comes on the heels of skyrocketing inflation, which surpassed 6% earlier this month, according to PYMNTS. The cost increase — on everything from food, shelter, vehicle purchases, transportation services, clothing and medical care services — reached its highest level since 1990. Gasoline netted the largest hike at nearly 50%, while other energy costs jumped 30%, compared to just under 25% in September.
Related: US Inflation Rate Surges Past 6%, Highest Since 1990
Inflation is consumers’ main concern and has led to declining living standards, according to MarketWatch.
Rising costs are due in part to supply chain bottlenecks and shortages of items. Grocery store chains are struggling to keep up with demand leading up to the holidays. This week, Florida-based Publix began limiting quantities of certain items, according to PYMNTS.
See more: Empty Shelves Test Grocery Store Customer Loyalty
In response to the holiday shopping challenges posed by empty shelves, more people are opting to buy gift cards for loved ones this holiday season, according to PYMNTS.
Blackhawk Network, a gift card provider, found through a recent survey that as many as 41% of consumers plan to buy gift cards for their holiday presents. On average, consumers will buy 15 prepaid cards in 2021 — a 50% jump over 2020 and a 200% surge over 2019.
Read more: Inventory Shortages Could Make Holiday 2021 The Year of the Gift Card
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