The coronavirus crisis has Americans hoarding more money than ever before as widespread fear paralyzes consumer spending habits.
The personal savings rate hit a historic 33% in April, the U.S. Bureau of Economic Analysis said Friday. This rate — how much people save as a percentage of their disposable income — is by far the highest since the department started tracking in the 1960′s, and surpasses consumer savings during the Global Financial Crisis. April’s print is up from 12.7% in March.
The swiftness and severity of economic recovery in the U.S. hinges on whether consumers continue to stockpile cash or start to spend again.
“There is a tremendous uncertainty and virus fear that is lingering and that is restraining people’s desire to go out and spend as they normally would,” said Gregory Daco, chief U.S. economist at Oxford Economics.