NEW YORK / RankWire.AI / – U.S. consumer confidence experienced a sharp decline in September, reaching its lowest point since April 2014. The Conference Board announced that its Consumer Confidence Index fell by 6.7 points to 81.9. The previous August figure was revised downward to 88.6. Data collected from September 1 through September 23 formed the basis for the survey. Consumers expressed more pessimism about current economic conditions and the outlook over the next six months. This marked the third consecutive month of declining overall confidence.
The Present Situation Index decreased by 7.9 points to 109.3 in September, reflecting consumers’ views on current business and labor market conditions. Meanwhile, the Expectations Index dropped 5.9 points to 63.6, marking a third month of decline. It gauges consumer expectations for income, employment, and business conditions over the next six months. The data indicates concerns are extending beyond current circumstances, with households feeling less optimistic about the economic environment ahead.
Perceptions of the current business climate softened throughout the month. About 18.5% of consumers rated conditions as good, compared to 18.8% in August. Conversely, those describing conditions as bad increased to 20.4% from 17.3%. Assessments of the labor market also deteriorated. Approximately 23.6% reported that jobs were plentiful, down from 24.5% in August, while 21.9% said jobs were hard to find, up from 20.3% the previous month.
Inflation expectations rise amid increasing gasoline prices
Consumers’ outlook on inflation for the upcoming year also grew more pessimistic. The average 12-month inflation forecast increased by 0.3 percentage points to 6.1%. The median estimate rose to 5.1%. According to federal data, consumer prices rose 3.4% in August compared to a year earlier. The U.S. Bureau of Labor Statistics reported gasoline prices jumped 3.9% month-over-month. AAA estimated the national average for regular gasoline at about $4.46 per gallon on September 29.
The survey also indicated a slowdown in spending plans across several key categories. On a six-month moving average, intentions to purchase cars and homes both declined. Expected expenditure on services also fell in September, with consumers reporting reduced plans for hotels, movies, air travel, and amusement parks. Conversely, vacation plans showed an increase. About 42.6% of respondents planned a trip within six months, up 0.5 percentage points from August. This rise was driven by stronger intentions for domestic travel.
Outlooks for business, jobs, and income weaken further
Expectations regarding business conditions, employment opportunities, and household income diminished further. Only 15.9% of consumers anticipated an improvement in business conditions, down from 17.0% in August. The percentage expecting conditions to worsen increased to 25.4% from 23.3%. Additionally, just 14.0% forecasted more job availability, while 28.4% expected fewer jobs. Income outlooks also softened, with 17.9% expecting higher incomes and 15.4% projecting income declines over the next six months.
The Conference Board also noted a decline in confidence regarding household finances. Net assessments of current family finances turned negative for only the second time since the measure’s inception four years ago. Confidence waned across all age groups on a six-month moving average, and nearly all income brackets registered lower readings. Toluna conducted the monthly online survey for The Conference Board. The preliminary results for September closed on September 23, with the next Consumer Confidence Index scheduled for release on October 27.
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