Consumer confidence fell to a six-month low in August, as COVID-19 infections soared nationwide amid an outbreak driven by the highly infectious delta variant.
The Conference Board released figures on Tuesday showing that its Consumer Confidence Index fell to 113.8 this month, down from 125.1 recorded in July.
The Present Situation Index, which focuses on consumers’ evaluation of current business and labor market conditions, fell to 147.3 from 157.2 the previous month.
The Expectations Index, which looks at consumers’ short-term outlook for income, business and labor market conditions, also fell.
Lynn Franco, senior director of economic indicators at The Conference Board, attributed the drop in consumer confidence to the spread of the delta variant.
“Concerns about the Delta variant — and, to a lesser degree, rising gas and food prices — resulted in a less favorable view of current economic conditions and short-term growth prospects,” Franco said in a statement.
She said that while spending plans for homes, cars and major appliances “cooled somewhat,” the percentage of consumers who are planning on taking a vacation in the next six months “continued to climb.”
“While the resurgence of COVID-19 and inflation concerns have dampened confidence, it is too soon to conclude this decline will result in consumers significantly curtailing their spending in the months ahead,” Franco added.
Consumer optimism for the short-term business conditions outlook also dropped in August: 22.9 percent of consumers believe business conditions will improve, down from 30.9 percent in July, while 17.8 percent think business conditions will worsen, up from 11.9 percent.
The figures come on the heels of a University of Michigan consumer sentiment report that found confidence fell in the first half of August.
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