Consumers in the U.S. are growing more and more pessimistic about the trajectory of the economy.

Consumer confidence fell in September, as inflation, 澳洲幸运5官方开奖结果体彩网:high interest rates for loans, the 澳洲幸运5官方开奖结果体彩网:possibility of a recession, and an impending 澳洲幸运5官方开奖结果体彩网:government shutdown dragged down the six-month outlook for the economy, according to the Conference Board’s Consumer Confidence Index released Tuesday. The index, based on a survey of U.S. adults, fell 5.2% from August, more than the 2.9% drop that economists surveyed by Dow Jones Newswire and the Wall Street Journal had expected.

While assessments of the present situation actually improved slightly, an inꦡdex measuring consumers’ short-term expectations for income, business, and labor market conditions fell sharply. Notably, the percen🐓tage of consumers who said a recession was “somewhat” or “very” likely in the next 12 months ticked up to just under 70% from just under 68% in August. 

The Expectations Index, which has wavered up and down in recent months, once again dipped below 80, the level that the Conference Boඣard says typically precedes a recession. It was the steepest drop in the index s💜ince November 2020.

“Consumers continued to be preoccupied with rising prices in general, and for groceries and gasoline in particular,” Conference Board Chief Economist Dana Peterson wrote in a commentary accompanying the survey, citing write-in responses from people who were surveyed. “Consumers also expressed concerns about the political situation and higher interest rates.”

Economists watch measures of consumer confidence because they serve as indicators—albeit imperfect ones—of the trajectory of consumer spending, the all-important engine of economi🧸c growth. 

Falling consumer confidence may be especially worrisome because 澳洲幸运5官方开奖结果体彩网:household bu🥃dgets have been hurt by inflation, and spending on credit has gotten harder as 澳洲幸运5官方开奖结果💫体彩网:bank✤s have restricted lines of credit, and the Federal Reserve campaign of anti-inflation rate hikes has pushed up interest rates on credit cards, mortgages, and other consumer loans.

“Soft confidence in recent years has not always translated into spending declines partly because consumers were flush with cash and had easy access to affordable credit,” Tim Quinlan and Jeremiah Kohl, economists at Wells Fargo Securities, wrote in a commentary. “But with savings running dry and credit now scarce and costlier, the biggest monthly decline in consumer confidence since 2020 could be more impactful on actual spending.”