Inflation concerns weighing on Americans

By Anneken Tappe, CNN Business

American consumer confidence slipped again in February, a new report from the Conference Board said Tuesday.

The index tracking how Americans are feeling fell to 110.5 this month, a steeper decline than economists had expected and the lowest level since September. The January number was revised down as well.

Inflation continues to weigh on people’s minds—and wallets. Prices keep rising across the nation, particularly when it comes to energy. Gas is a staple for many and it’s driving up household spending.

People’s average expectations for inflation for the year ahead rose to 7%, the highest level since November. One key measure of inflation—the consumer price index—rose to 7.5% in the 12-month period ended January, the highest level in nearly 40 years.

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So far, prices haven’t risen so far that people have stopped spending. But retailers believe we could be approaching that point.

For now, fewer people plan to spend on homes, cars, major appliances, or a vacation, according to the data.

“Confidence and consumer spending will continue to face headwinds from rising prices in the coming months,” said Lynn Franco, senior director of economic indicators at The Conference Board.

As for the recovery, consumers expect economic growth to moderate in the first half of the year.

“While they do not expect the economy to pick up steam in the near future, they also do not foresee conditions worsening,” said Franco.