NEW YORK / RankWire.AI / – U.S. consumer confidence reached its lowest point since April 2014 in September, marking a continuation of a three-month downward trend in household optimism. The Conference Board announced that its Consumer Confidence Index decreased by 6.7 points to 81.9. The figure for August was revised downward from previous estimates to 88.6. Data for September was collected from responses between September 1 and September 23. Both current conditions and expectations for the upcoming six months saw declines during this period.
The Present Situation Index dropped 7.9 points, settling at 109.3, indicating a more pessimistic outlook on business and labor markets. Meanwhile, the Expectations Index fell by 5.9 points to 63.6, marking its third consecutive month of decline. This index gauges consumer opinions regarding income, business prospects, and employment over the next six months. The declines in July and August were followed by September’s downturn, pushing the overall confidence measure further below earlier in the year.
According to the survey conducted by The Conference Board, there was a noticeable shift in perceptions of current business conditions. About 18.5% of consumers described conditions as good, a slight decrease from 18.8% in August. Conversely, the percentage of those rating conditions as bad increased to 20.4% from 17.3%. Views on the labor market also deteriorated, with 23.6% stating jobs were plentiful, down from 24.5%, and 21.9% reporting that jobs were hard to find, up from 20.3%.
Inflation expectations climb amid elevated fuel prices
In September, consumers expressed higher inflation expectations. The average 12-month outlook for inflation increased by 0.3 percentage points to 6.1%, while the median expectation rose to 5.1%. Federal data indicated that consumer prices grew by 3.4% in August compared to the previous year. The U.S. Bureau of Labor Statistics reported a 3.9% rise in gasoline prices during August. Additionally, AAA noted that the national average for regular gasoline was approximately $4.46 per gallon as of September 29.
Spending plans across several categories also showed signs of moderation. On a six-month moving average basis, intentions to purchase automobiles and homes both slightly declined in September. Expectations for spending on services, such as hotels, movies, air travel, and amusement parks, continued to decrease. However, plans for vacations remained relatively firm, with 42.6% of consumers intending to travel within six months. This figure increased by 0.5 percentage points from August, primarily driven by domestic travel plans.
Weakened outlook for employment and income
Expectations regarding business conditions, employment opportunities, and income prospects also diminished. Only 15.9% of consumers anticipated an improvement in business conditions, down from 17.0% in August. The proportion expecting conditions to worsen increased to 25.4% from 23.3%. Regarding jobs, 14.0% believed more opportunities would become available, whereas 28.4% expected fewer jobs. Income forecasts also softened, with 17.9% expecting gains and 15.4% predicting declines over the next six months.
The survey revealed broader financial pressures within households. Net perceptions of current family finances turned negative for only the second time since the measure’s inception four years ago. Confidence levels declined across nearly all age groups and income brackets on a six-month average basis. The online monthly survey conducted by Toluna for The Conference Board concluded with September’s preliminary results, which closed on September 23. The next Consumer Confidence Index is scheduled for release on October 27.