US consumer confidence is the lowest in four months

Minneapolis
CNN
—

Gas prices rise And High interest rates Increased economic uncertainty and a decline in consumer confidence contributed in September, sending the main economic indicator falling to a four-month low, according to data released Tuesday.

The Conference Board’s consumer confidence index fell for the second straight month, falling to 103 in September from an upwardly revised 108.7 the previous month. The index reached its second lowest level this year, falling just above May’s reading of 102.5, according to Conference Board data.

“Consumers remain concerned about rising prices in general, and for groceries and gasoline in particular,” Dana Peterson, chief economist at the Conference Board, said in a statement. “Consumers also expressed concerns about the political situation and rising interest rates. The decline in consumer confidence was evident across all age groups, particularly among consumers with household incomes of $50,000 or more.

Peterson noted that the business organisation’s “expectations index” fell below 80 – the threshold that often indicates a recession is imminent – to 73.7, reflecting less confidence about future business conditions, job availability and income.

“Consumers may be hearing more bad news about corporate profits, while jobs shrink, and interest rates continue to rise — making expensive goods more expensive,” she said. “Interest rate expectations fell in September after rising the previous month, but stock price expectations continued to decline.”

The share of consumers surveyed who believe a recession is “somewhat likely” or “very likely” to occur rose in September after falling in August.

Consumers face increasing headwinds as high inflation continues to take its toll along with decades-long high interest rates. Growing credit card debta Labor market slowdown And the Return of student loan payments.

The latest reading from the Conference Board reinforces expectations that consumers will hold back on spending in the fourth quarter of this year, Matthew Martin, a US economist at Oxford Economics, wrote in a commentary issued on Tuesday.

Consumer spending is a critical driver of American economic growth.