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U.S. Consumer Confidence Falls to Lowest Level in 6 Years
New York-based The Conference Board reported Tuesday that its Consumer Confidence Index declined to a reading of 84.8 in August, the lowest level since May 2014 and the second straight monthly drop. The reading reflects the impact the COVID-19 pandemic is inflicting on the economy and consumers mindsets.
The peak reading this year was reached in February, but since then the index has fallen 36%. Last month, the group reported the index declined to 91.7. Since 70% of U.S. economic activity is tied to consumer spending, economists closely watch the confidence level of people to gauge sentiment as a way to determine future prospects.
Lynn Franco, The Conference Board’s Senior Director of Economic Indicators, says “The Present Situation Index decreased sharply, with consumers stating that both business and employment conditions had deteriorated over the past month. Consumers’ optimism about the short-term outlook, and their financial prospects, also declined and continues on a downward path. 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.”
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- ◦Economy
