Consumer confidence plunges to six-year low
Consumer confidence, a key indicator of the country’s economic health, has fallen to its lowest point in six years as the coronavirus recession shows little sign of letting up.
The Conference Board said Tuesday that its Consumer Confidence Index dropped to 84.8, the second consecutive monthly decline, from 91.7 in July.
“Consumer spending has rebounded in recent months but increasing concerns amongst consumers about the economic outlook and their financial well-being will likely cause spending to cool in the months ahead,” said Lynn Franco, senior director of economic indicators at The Conference Board.
Purchases by consumers account for about two-thirds of the U.S. economy, so any signs of low confidence among Americans can have serious implications for the economy going forward.
The survey results come the same week of the GOP convention, where several Republicans are pointing to the pre-pandemic economy in arguing that President TrumpDonald John TrumpThe Memo: Fear overshadows hope at GOP convention’s first night Former Trump administration officials launch anti-Trump group Trump, GOP seek to rebut Democratic narrative on night one MORE is best suited for leading an economic recovery.
The Conference Board’s monthly survey found that consumers lowered their assessments of both current conditions and their expectations for the near-term outlook on income, business and labor market conditions.
The declining confidence comes amid the expiration of key federal benefits and protections for workers and households that were enacted early on in the pandemic. More than 28 million Americans receiving unemployment benefits saw $600 in additional weekly benefits evaporate at the end of July.
Congressional Democrats and the Trump administration are deadlocked over a new relief package that would likely renew a program to help small businesses stay afloat and keep workers on the books.
A survey released this week from the National Federation of Independent Business found that some 40 percent of businesses do not expect to survive a year unless economic conditions improve. Half of those surveyed said they would have to shutter within six months.