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Americans buy less food as gas prices rise: survey


Shopper Laura Miller (L) and her daughter shop at a Wal-Mart store in Santa Clarita, California April 1, 2008. REUTERS/Mario Anzuoni
Shopper Laura Miller (L) and her daughter shop at a Wal-Mart store in Santa Clarita, California April 1, 2008. REUTERS/Mario Anzuoni

By Dhanya Skariachan

NEW YORK (Reuters) - U.S. shoppers are making fewer shopping trips, eating out less, and skimping even on groceries to rein in household budgets amid rising gasoline prices, a survey showed.

The findings don't bode well for the U.S. economy, which struggled to gain momentum early in the second quarter, with retail sales posting their smallest rise in nine months in April. Consumer spending accounts for more than two-thirds of the U.S. economy.

About a third of Americans surveyed by America's Research Group said they were making fewer trips to stores due to higher gas prices, with about 53 percent of participants also cutting back on small luxuries like sit-down dining.

The question was one of several asked exclusively for Reuters as part of a larger America's Research Group survey.

"These gas prices are killing them," said Britt Beemer, president of America's Research Group. "When it costs you $25 more a week to fill up your gas tank, that's $25 less you are going to spend that week on anything else."

The national average for a gallon of self-serve, regular gasoline was $4 per gallon on May 6, up 11.98 cents from April 22, according to the nationwide Lundberg Survey.

U.S. shoppers are also increasingly cutting back on grocery spending as they spend more at the pump. More than 42 percent of the 1,000 surveyed said they curtailed spending in the grocery aisles of retailers.

"When you got numbers like that, that's not good for the economy," Beemer said.

Most Americans, except the top 6 percent on the income chart, are feeling the pinch of higher gas prices, Beemer said, warning that sales at retailers and restaurants could suffer further if gas prices don't retreat.

"My biggest worry is if gas prices hit $4.50 and $5, I think you are going to put America into literally a retail shock mode where consumers are going to start cutting back on everything other than household essentials," Beemer said.

The telephone survey was conducted May 4-10 and has an error factor of plus or minus 3.8 percent.

(Reporting by Dhanya Skariachan; Editing by Richard Chang)

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