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Consumer Confidence Drops in August, Sparking Recession Concerns
In August 2023, US consumer confidence saw a decline, wiping out the positive momentum observed in June and July. The Conference Board Consumer Confidence Index® dropped to 106.1, a decline from July's revised figure of 114.0. This dip was influenced by both current conditions and future expectations, with concerns mounting around rising costs, especially for essential goods like groceries and gasoline.
Dana Peterson, Chief Economist at The Conference Board, remarked, “Consumer confidence fell in August 2023. Write-in responses showed consumers were preoccupied with rising prices. The decline in confidence was pronounced among those with household incomes at both higher and lower extremes.”
Additional data reveals growing pessimism around employment, with fewer consumers feeling that jobs are abundant and more finding them scarce. Key indicators signal slowdowns in employment gains, tighter wage growth compared to the past year, and a gradual increase in unemployment duration. Anticipation for the coming months isn't much brighter, as expectations sit close to the recession threshold. With increasing concerns over corporate earnings, limited job vacancies, and rising interest rates making larger purchases costlier, the future economic climate remains uncertain.