August consumer confidence lowest in more than two years

NEW YORK Tue Aug 30, 2011 11:04am EDT

A shopper passes an advertisement on a shop in Oxford Street in London September 30, 2010. REUTERS/Luke MacGregor

A shopper passes an advertisement on a shop in Oxford Street in London September 30, 2010.

Credit: Reuters/Luke MacGregor

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NEW YORK (Reuters) - Consumer confidence crumbled in August to its lowest level in more than two years as the fallout from political wrangling over a budget deal took its toll, according to a private sector report released on Tuesday.

The Conference Board, an industry group, said its index of consumer attitudes sank to 44.5 from a downwardly revised 59.2 the month before. The index was well off a poll of economists by Reuters for a reading of 52.0.

The index was at the lowest level since April 2009, the report said. July was originally reported as 59.5.

Consumers' outlook also deteriorated sharply as the expectations index plunged to 51.9 from 74.9. The assessment of consumers' present situation fared better with the index slipping to 33.3 from 35.7.

Consumers have faced many hurdles recently, including the debate surrounding the debt ceiling, the downgrade of the U.S. credit rating by Standard & Poor's, volatility in financial markets and increased fears the economy is heading for another recession.

"A contributing factor may have been the debt ceiling discussions since the decline in confidence was well underway before the S&P downgrade," Lynn Franco, director of The Conference Board Consumer Research Center, said in a statement.

Consumers' labor market assessment also worsened. The number of respondents saying they found "jobs hard to get" rose to 49.1 percent from 44.8 percent the month before, while the "jobs plentiful" category fell to 4.7 percent from 5.1 percent.

The view on prices increases was unchanged with expectations for inflation in the coming 12 months holding steady at 5.8 percent.

(Reporting by Leah Schnurr; Editing by Padraic Cassidy)

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Comments (3)
seattlesh wrote:
Was this debt debacle the tea party’s idea of economic stimulus and job’s creation? Why have the more moderate and saner voices in both the Democratic party and Republican party allowed this fringe group to control the dialogue? Why have we voters allowed this to happen?

Aug 30, 2011 10:47am EDT  --  Report as abuse
jrj90620 wrote:
The idiot public still believes inflation is not a problem,while the only problem is unemployment.That means govt will continue it’s deficit spending and the Fed will continue devaluing the Dollar.Should be bullish for real assets such as stocks,commodities and real estate and bearish for Dollars.

Aug 30, 2011 11:06am EDT  --  Report as abuse
ConradU812 wrote:
Obamanomics: The idea to create jobs by creating more government programs which hires tax-paying employees, who provide the revenue to pay their own payroll, which in turn gets taxed and……where was I?

Aug 30, 2011 12:30pm EDT  --  Report as abuse
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