
The Conference Board’s Consumer Confidence Index, an indicator used to measure Americans’ confidence in the economy, fell from 105.6 in August to 98.7 in September. This is the largest drop since August 2021.
The premise of the index is that if consumers say they are optimistic, they are expected to spend more money, thus helping stimulate the economy. However, if consumers are pessimistic, their spending could slow down, helping contribute to a recession.
The current and future labor market, and the future outlook on business conditions and income are all notable reasons consumers felt pessimistic about the economy in September.
“Confidence declined in September across most income groups, with consumers earning less than $50K experiencing the largest decrease,” said Dana Peterson, chief economist at The Conference Board. “On a six-month moving average basis, consumers earning over $100K remained the most confident.”