Higher prices at the gas pump and tremors in the stock market eroded a bit of the confidence that kept spend-happy Americans running to the stores in February, but overall consumer confidence remains high.
dipped in February from January's all-time high, according to a report released Tuesday by the
, a trade group. The board's consumer confidence index slipped to 141.8 in February from 144.7 in January.
The decline in confidence was driven mostly by consumers' concerns that higher interest rates, lofty energy prices and stock market shakiness might cause them to curtail their spending over the next six months.
The report does little to quell fears that rampant consumer demand could eventually spur an outbreak of inflation. But it might mean that consumers are starting to take notice of the message that the Federal Reserve has been trying to send through higher interest rates.
Another sign consumers might be starting to feel the pinch of higher rates came Monday, when the Commerce Department reported that growth in wages outpaced growth in consumer spending in January for the first time since October.
Meanwhile, a bit more cautiousness on the part of consumers could also be seen in some measures of February retail sales. One measure of retail sales from industry-watcher
showed that sales in February grew at 0.8%, below retailers' target levels, despite clearance sales and promotions related to the Presidents Day holiday.
Although the data might seem encouraging for economists who are looking for signs that economic growth will moderate this year, it doesn't do much to convince economists that the Fed's rate-raising job is done.
"Confidence is not skyrocketing anymore, but there's not a lot to suggest that consumers have suddenly become worried about something," said Carol Stone, deputy chief economist at Nomura Securities in New York.
And even if consumers may be moderating, manufacturers are continuing to chug along as evidenced by the Chicago Purchasing Management survey, a private report that indicates accelerating growth in factories in the industry-laden Chicago region.
The Chicago report also shows that the cost of raw materials for manufacturers is on the rise, mostly due to higher fuel and energy costs. That could eventually mean businesses will have to pass on rising costs to consumers.
"For now, there doesn't seem to be any break-out inflation story here," Stone said, adding that more evidence will be needed that the roaring economy might be moderating.