U.S. Consumer Spending Outlook ‘Positive,’ IHS Says
“We saw a downtick to consumer confidence from the sequester, but despite the payroll tax increase and a recent gas price increase, the fundamentals of consumer spending have strengthened and are very positive,” Behravesh said at the gathering, sponsored by J.D. Power & Associates and the National Automobile Dealers Association, held in connection with the New York auto show.
New-car buyers, shunned by lenders just four years ago, are benefiting from historically low interest rates and better access to financing. U.S. light-vehicle sales in the first two months of 2013 rose 8.4 percent to 2.24 million, according to researcher Autodata Corp.
Democrats and Republicans are deadlocked over how to replace mandated across-the-board cuts, known as sequestration, totaling $1.2 trillion over nine years. The sequester could cut 0.5 percentage points from growth in 2013, with the biggest impact in the second quarter, Behravesh said.
“Things are really starting to look good in the U.S.,” he said. “They could get detailed by what’s going on in Washington, but chances are they won’t be.”
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