The impact of commodity prices on consumers' wallets continues to sink lower from its highs in early July. At the peak of the commodities bubble in July, the average daily impact of higher commodities was costing the average American an extra $4.77 per day in 2008 versus 2007 (or about $523 billion in total). Now just over three months later, that 'tax' on the consumer has turned into a windfall of $2.00 per day or $220 billion in total. While the $4.77 a day 'tax' surely hurt the already strapped consumer this year, the reversal to a $2.00 per day windfall should provide some relief.
In the above chart we calculated the '08 price change of the major food and energy commodities in the CRB index (Corn, Soy, Wheat, Cattle, Hogs, Oil and Natural Gas) and multiplied the changes by the annual per capita consumption of each item. While this method may oversimplify the actual costs, it provides a good idea of how changes in commodity prices have impacted consumers wallets this year.
Subscribe to Bespoke Premium to receive more in-depth research from Bespoke.
Comments