Consumer confidence fell unexpectedly in August, a potential indicator that the general public sees the U.S. economy as weakening. The report comes as the Federal Reserve has not met its inflation goal and many Americans see the economy as being in poor shape.
According to the Conference Board, consumer confidence fell significantly between July and August, well below the original expectations.
According to Conference Board Chief Economist Dana Peterson, “August’s disappointing headline number reflected dips in both the current conditions and expectations indexes.”
Not only did consumer confidence fall in the most recent survey, but sentiment regarding the current state of the economy in general fell sharply. Furthermore, Americans reporting that employment is “hard to get” increased from 11.3% to 14.1%.
The research also found that 17.2% of the public believes that the nation’s business conditions are poor, up from the previous month.
*U.S. AUGUST CB CONSUMER CONFIDENCE SINKS TO 106.1; EST. 116.0; PREV. 114.0
— Investing.com (@Investingcom) August 29, 2023
Americans are also wary about the country’s medium-term economic forecast. Like the current consumer confidence drop, the public registered lower expectations regarding the national economy six months from now. The overall expectations index carried out by the Conference Board rated at 80.2, which is slightly above forecasting a recession.
Overall, 69% of the public believes that a recession is “somewhat” or “very likely.”
Another poll from earlier in August found that the country’s small businesses were also pessimistic about the near future of the American economy.
According to the CNBC/SurveyMonkey Small Business Survey, small business owners gave President Joe Biden low marks for his job performance. Fewer than half of such firms reported the easy ability to get working capital, down from 53% earlier in the year.
The same poll found that small business leaders are largely not confident in the state of the American banking sector. A total of 45% showed faith in the nation’s banks, while 54% disagreed. The United States suffered a number of high-profile bank failures earlier this year.
Overall, the number of business owners describing the country’s economy as “good” tallied just 38%, while 46% describe it as “middling.” A further 15% describe the current economy as “bad.”
Among business leaders, Biden currently rates a 31% approval rating, compared to 68% who disapprove.