Consumer confidence just hit a seven-month low. Here’s what’s driving it
The Expectations Index, reflecting consumers’ short-term outlook for income, business, and labor market conditions, fell 5.8 points to 68.2, below the 80 threshold historically associated with recession risk.
“Consumer confidence moderated slightly in August for a second consecutive month,” said Dana M. Peterson, chief economist at The Conference Board.
“Consumers were more pessimistic about business conditions and the labor market over the next six months, while expectations for household incomes weakened but remained positive overall.”
A market split in two
All three components of the Expectations Index declined in August. Net expectations for business conditions fell 2.5 percentage points to -6.3%, while net labor market expectations slipped 2.6 percentage points to -11.5%.
Income expectations eased 3.1 percentage points but held in positive territory at +3.8%.
