Consumer Confidence Falls To Lowest Level in a Year
U.S. consumer confidence deteriorated in August to its lowest in a year on concerns about a softening labor market and market turmoil stemming from the subprime mortgage crisis, a business research group said on Tuesday.
The Conference Board said its consumer sentiment index fell to 105.0 in August from a downwardly revised 111.9 in July. In August 2006, the index was 100.2.
The median forecast among economists polled by Reuters was 104. The group originally reported the July index at 112.6, the highest since August 2001.
"A softening in business conditions and labor market conditions has curbed consumers' confidence this month. In addition, the volatility in financial markets and continued subprime housing woes may have played a role in dampening consumers' spirits," said Lynn Franco, director of the group's consumer research center, in a statement.
Consumers' assessment of current and future conditions also worsened this month. The group's present situation index fell to 130.3 from a downwardly adjusted 138.3 in July. The expectations index declined to 88.2 in August versus a downwardly revised 94.4 in July.
Inflation expectations held steady despite lower gasoline prices, the report showed.
The average retail price for regular gasoline slipped 3.6 cents last week to $2.75 a gallon, the lowest weekly level in almost five months, according to the U.S. Energy Information Administration.
Consumers' expectations for the inflation rate in 12 months stood at 5.1 percent in August, unchanged from July.
Regarding employment, consumers surveyed who said jobs were "plentiful" declined to 27.5 percent in August from a downwardly revised 30.0 percent in July, the Conference Board said. Those who said jobs were "hard to get" rose to 19.7 percent in August from an upwardly adjusted 18.7 percent in July.