Kike Calvo/`
- US consumer confidence fell more-than-expected in August, the Conference Board said.
- The fall was the sharpest in two years on ongoing inflation and labor market concerns.
- These three charts show how Americans feel about the economy.
Americans are currently not doing well with the state of the US economy or their place in it.
The Conference Board reported on Tuesday that its consumer confidence indicator fell to 106.1 in August, below Bloomberg estimates and a new three-month low. A month ago, that number was 114.0.
While the US has avoided a recession so far this year, Americans say they are still feeling the pain of higher interest rates and prices above the Federal Reserve’s 2% inflation target.
“Registered responses showed that consumers were once again concerned about rising prices in general, and for food and gasoline in particular,” said Dana Peterson, chief economist at the Conference Board, in a statement. “The decline in consumer confidence was evident across all age groups — and most notably among consumers with household incomes of $100,000 or more and those earning less than $50,000.”
Consumer Confidence Index, August 2023 The Conference Board
Peterson added that Americans’ assessment of the current situation fell in August as job growth slowed and wage increases were less generous.
Consumers also reported that their current financial situation has deteriorated over the past month.
The chart below shows that an increasing proportion of respondents said they felt “bad” about their current situation, while the proportion who said they felt “good” decreased.
Current financial situation of the family The Conference Board
However, the proportion of respondents expecting a US recession next year fell in August but remains high at 69.0%, according to the Conference Board.
Perceived probability of a US recession over a 12-month period The Conference Board
“Expectations for the next six months fell back near the recessionary level of 80, reflecting lower confidence in future business conditions, job availability and incomes,” Peterson said. “Consumers may hear more bad news about corporate earnings as job vacancies shrink and interest rates continue to rise – making expensive items more expensive.”
Separate data released Tuesday by the Bureau of Labor Statistics showed that the number of job vacancies in the US fell to 8.83 million, the lowest since early 2021, suggesting the job market may finally be cooling.
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