Deloitte Consumer Spending Index drops sharply in March

NEW YORK — A survey released Tuesday by Deloitte found that consumer purchasing power was negatively impacted during the month of March.

The Deloitte Consumer Spending Index tumbled to 3.62% from nearly 4.1% in the prior month. Deloitte’s chief economist and author of the monthly index, Carl Steidtmann, said that despite the economic recovery, consumers don't have the motivation to spend.

“Inflation anxiety may continue to wear at consumer confidence in the months ahead,” Steidtmann said. “Despite the recovery, consumers continue to save at a relatively high level, suggesting that [they] have the means to spend but not the will. However, a continued improvement in the employment figures could be enough to instill a greater sense of security among U.S. households and offset some of the rising cost pressures as well.”

The index, which is comprised of four components — tax burden, initial unemployment claims, real wages and real home prices — tracks consumer cash flow as an indicator of future consumer spending.