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Gas prices aren’t leading to less driving — yet

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Data: Federal Reserve Bank of Dallas, Energy Information Administration; Chart: Simran Parwani/Axios

The rise in U.S. fuel prices isn’t yet spurring a major pullback in driving, but that could soon change, a new Dallas Fed analysis finds.

The big picture: Gas demand is historically not very sensitive to prices.

But “prices may be closer to consumers’ pain threshold than inflation-adjusted prices might suggest,” Dallas Fed economist Garrett Golding writes.If they rise higher, “expect consumers to respond by cutting back on fuel consumption and overall spending sooner than later.”

What we’re watching: Remote work options could reduce demand, per the report, but it’s “too early to fully assess the impact.”

And many low-wage workers — the ones most hurt by high costs — lack that choice.