Experts and economists had predicted that American consumers would pivot spending away from their pandemic patterns towards a return to eating out and travel in 2022.
But the surge in cases due to the infectious omicron variant, record high inflation and rising gas prices have thrown a spanner in the works.
Russia's invasion of Ukraine is also stoking fears of higher macroeconomic uncertainty in the near term.
Data from the Bureau of Labor Statistics shows inflation in the United States reached its highest level in four decades in March.
According to the U.S. Energy Information Administration, the price of a gallon of gas averaged $4.107 countrywide during the week of April 25.
That was an increase from $4.066 a week ago.
Hikes like those now have some consumers reining in spending as they hunker down to wait inflation out.
Less Coffee Breaks?
Recently, Americans have been drinking less coffee at coffee shops, including at major chains.
Starbucks (SBUX) and Dunkin' (DNKN) visits were down 1.9% and 1.8% respectively, during the week of April 11 compared to the same week last year, data from analytics firm Placer.ai showed.
The flow of people had largely returned to pre pandemic highs at Starbucks stores and rival Dunkin' Donuts between July and December last year, the company added in a blog post.
Starbucks reported a 23% rise in revenue due to rise in customer traffic during the holiday season, Starbucks President and Chief Executive Kevin Johnson said during the fiscal first quarter earnings call.
More recently, trips to Starbucks increased in February but fell in March.
Visits increased by 2.5% for the week of March 14, 2022, compared to the same week in 2019. They were down for the next four weeks compared to the same period in 2019.
It's the same for coffee and baked goods chain Dunkin' Donuts, which is also feeling the pinch of inflation.
"Due to the high inflation rates and rising gas prices, many consumers are now spending more on essentials, which means that their budget is tighter — even if their spending habits have not changed," according to Placer.ai's report.
But the research firm also added that consumers saving money on dining out may be treating themselves to a cup of coffee as a cheaper alternative to their typical purchased complete meals.
It added that in the current economic context, bringing foot traffic within a percentage point or two of pre-pandemic levels is notable, the report added.
Placer.ai cited data from an April CNBC Momentive poll which showed that 53% Americans have reduced their meals out in the last six months due to rising prices.
Some 39% of the 3,953 adults polled for the online survey, have also cut back on driving due as rising inflation hammers household budgets.
Fully 81% of the respondents said the U.S. will likely face a recession in 2022.
Experts are still split over the growth prospects of the U.S. economy.
While Treasury Secretary Janet Yellen recently she does not expect the U.S. to slip into a recession but added that inflation is likely here to stay.
"But look, inflation has been high," Yellen said.
"The shocks emanating from this unjustified attack on Ukraine will prolong inflationary pressures so the outlook is uncertain. But I think we'll have to put up with high inflation for a while longer," Yellen added.
However, Fed Chairman Jerome Powell told a panel at the IMF's spring meetings in Washington that there was a case for "front loading" rate hikes, and that a half-point increase would be considered.
