U.S. consumers aren't spending their extra cash from cheap gasoline and are saving more, according to a Reuters/Ipsos poll. Bobbi Rebell reports.
Cheap gas is putting more money in Americans' wallets, but a new Reuters/Ipsos poll finds consumers aren't going on spending sprees with that extra cash.
The data shows [that] 75 percent of Americans say the extra money helped them cover basic needs. But the majority [have] not used their windfall to buy big ticket items.
Over 40 percent of respondents said they used their savings to pay down debts.
And data out Monday from the [Department of Commerce] confirmed that savings rose to a three-year high, while spending was flat.
Cheap gas hasn't fueled consumption, says Barclay's economist Michael Gapen:
SOUNDBITE: MICHAEL GAPEN, CHIEF U.S. ECONOMIST, BARCLAYS, (ENGLISH) SAYING:
"I think the bottom line is that they are probably not helping out as much as people would have thought given how far oil has come down."
The question then, is why?
Gapen says, households may not view the drop as permanent and still believe oil prices will rise.
He adds, the economic turmoil around the world makes them hesitant to spend.
And consumers are also aware of the flip side of lower oil prices. They fear the huge U.S. energy sector will cut jobs and investment.
Those fears may be overblown. Goldman Sachs estimates those job losses at 35,000 on the high end. That is a relatively small number given the 292,000 new jobs added to the U.S. economy last month.