American consumers are feeling less confident this month, according to the latest data from the Conference Board. The consumer confidence index fell to 98.7 in September, down from 105.6 in August, marking the largest month-to-month decline since August of 2021. The survey was conducted before the Federal Reserve announced a half-point interest rate cut last week.
The index measures Americans’ assessment of current economic conditions and their outlook for the next six months. Short-term expectations for income, business, and the job market all declined, with the job market being a significant concern. A reading below 80 could indicate a potential recession on the horizon.
Consumer spending plays a significant role in the U.S. economy, accounting for nearly 70% of economic activity. Economists closely monitor consumer confidence to gauge the overall sentiment and forecast future economic trends. The latest data suggests that consumers may be more cautious about their financial prospects, which could impact spending patterns in the coming months.
The decline in consumer confidence highlights the importance of addressing concerns about jobs and income stability. With ongoing economic uncertainty and the potential for a recession looming, policymakers and businesses will need to consider strategies to support consumers and maintain economic stability.
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