Daily Management Review

US Consumer Confidence Index collapses to lowest since 2016


The consumer confidence index in the United States in August 2019 decreased to 89.8 points from the July level of 98.4 points, according to the final data of the University of Michigan.

The index value has become minimal since October 2016.

Preliminary data indicated a decrease in the indicator to 92.1 points, and a consensus forecast of experts suggested that the indicator be revised upward to 92.4 points.

The sub-index of the attitude of American consumers to the current financial situation in August fell to 105.3 points from 110.7 points in July, a decrease to 107.4 points was previously indicated.

Meanwhile, the indicator of consumer expectations for the next six months fell to 79.9 points from 90.5 points; preliminary data suggested a reduction to 82.3 points.

Inflationary expectations for the medium term (next year) increased to 2.7% from 2.6%, the forecast for the long term (horizon 5-10 years) grew to 2.6% from 2.5%.

A sharp decline in the aggregate index and its components testifies to the growing fears of Americans about the government’s trade policy and the likelihood of a recession in the country.

Currently, a mark of 100 points corresponds to the confidence level of 1966. The average value of the indicator during the last recession, which began in December 2007 and lasted 18 months, was 64.2 points, and 89 points - over the five years.

The indicator reached a record of 111.4 points in January 2000, and a historical minimum of 51.7 points was recorded in May 1980. The average level of the index for the entire time of obsevation since 1952 is 86.3 points.

source: bloomberg.com