Source: Wall Street News
The double pressure of high inflation and borrowing costs, combined with labor market uncertainty, hurt American consumer confidence. The US consumer confidence index fell to its lowest level since mid-2022 in April.
Due to high inflation, high borrowing costs, and a gradually cooling labor market, Americans' pessimism about the labor market and economic outlook intensified, and the US consumer confidence index declined in April to its lowest point since mid-2022.
On Tuesday, April 30, according to the latest data from The Conference Board (The Conference Board), the consumer sentiment index fell to 97 from 103.1, which was revised downward in March. The number has been falling for the third month in a row and is below all economists' expectations in the Bloomberg survey.
Consumers are also pessimistic about future economic prospects. The expected index for the next six months fell to 66.4, the lowest level since July 2022. Meanwhile, the indicator measuring the current state of the economy fell to 142.9.
Labor markets and income expectations have also worsened. Consumer surveys show that fewer consumers think job opportunities are “adequate,” while the number of people who think jobs are “hard to come by” has increased. The difference between the two, an indicator of labor market strength that economists are closely watching, has fallen to its lowest level since November last year. This means that people's confidence in the labor market has declined, and they feel that finding a job is more difficult than before.
Furthermore, the proportion of respondents who are expected to have more employment opportunities within the next six months has fallen to its lowest level since 2011. At the same time, their earnings expectations have deteriorated.
Under the influence of uncertainty, consumer spending expectations have also been affected. According to a special survey question, nearly half of the respondents plan to cut back on eating out in the next six months to save money, while others said they would reduce or eliminate spending on clothing and entertainment. In addition, plans to buy cars, homes, and appliances have also shown weakness, and interest in vacations has declined as well.
Dana Peterson, chief economist at the US Conference Committee, said in a statement:
“Consumers have become less optimistic about the current state of the labor market and are more concerned about the future business environment, employment opportunities, and income.”
“While inflation expectations remain stable, consumer concerns are focused on continuing high food and gasoline prices.”
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