August brings big drop in consumer confidence reading
After an uptick in July, the Consumer Confidence Index issued by The Conference Board fell to 44.5, down from a downwardly revised 59.2 reading in July.
The August figure is the lowest since April 2009 when the index was 40.8.
"Consumer confidence deteriorated sharply in August, as consumers grew significantly more pessimistic about the short-term outlook," said Lynn Franco, director of The Conference Board Consumer Research Center. "A contributing factor may have been the debt ceiling discussions since the decline in confidence was well underway before the S&P downgrade. Consumers' assessment of current conditions, on the other hand, posted only a modest decline as employment conditions continue to suppress confidence."
Consumers claiming business conditions are "bad" increased to 40.6% from 38.7%, while those claiming business conditions are "good" inched up to 13.7% from 13.5%.
More troubling metrics were reported in the measures of the short-term outlook. Those expecting business conditions to improve over the next six months decreased to 11.8% from 17.9%, while those expecting business conditions to worsen surged to 24.6% from 16.1%.