Younger consumers, especially Gen Z, are getting squeezed the most by surging rent rates as inflation bites the US economy, says Bank of America

Bank of America says younger consumers are being hurt the most by rising rents.

According to the report, the median rent payment for Gen Z was up 16% in July compared with the same month a year ago.

Rent payments increased in July.

The report said that a sizeable increase in rental prices have squeezed consumer pocketbooks.

As the economy grapples with hot inflation that has lifted the prices of everything from energy to groceries, the average rent in the US has increased to $1,722. It works out to be about a third of their pay.

More Americans are having trouble paying rent. According to Fannie Mae, higher mortgage rates have depressed consumer sentiment over house buying to its lowest level in a decade, with only 17% of consumers saying it's a good time to buy a home.

Middle and lower income households can be impacted by a significant increase in rent. The data shows that all income groups have seen an increase in rent payments, but those with annual household income between $51,000 and $150,000 have been hardest hit.

The bank notes that the decline in gas prices has provided consumers with some relief, despite the fact that the trend appears to be the same.

The average price of gas in the US has fallen below $4 a gallon for the first time since March.

The report said that the decline in gas spending freed up money for other things.