For the next couple of months, your Facebook and Instagram feeds will likely be dominated by beach holiday photos, beers in the sand and people's legs at the pool. School is out for summer and people are ready to vacation!
American consumers are as confident as ever and this should translate to a great summer spending season. This summer, Americans are expected to spend a total of $101.1 billion on vacations this year, representing a robust 12.5% increase from 2016, according to projections from the Vacation Confidence Index released Wednesday by insurance company Allianz Global Assistance. This is the first time in the index’s eight-year history that spending has exceeded $100 billion.
Confidence is soaring
In June, consumer confidence surprised economists with a very strong reading of 118.9. Furthermore, consumer expectations improved to a nearly 16-year high, according to Director of Economic Indicators at The Conference Board Lynn Franco.
“Expectations for the short-term have eased somewhat, but are still upbeat. Overall, consumers anticipate the economy will continue expanding in the months ahead, but they do not foresee the pace of growth accelerating,” said Franco.
Summer spending boom
“Americans are feeling better about the economy and have loosened their purse strings for summer 2017,” said Daniel Durazo, director of communications at Allianz Global Assistance USA.
This confidence could also be a reflection of lower gas prices, according to AAA. The cost to fill up the tank for the Fourth of July holiday weekend was set to be the lowest level recorded in 12 years — and AAA predicts that more Americans traveled for the holiday than ever before. I can attest to the fact that the roads were unusually quiet on the way to work last week and on the radio, the typically busy Hudson River crossings barely had delays at rush hour.