Consumer morale slumped this month, lower than economists were expecting. The nation’s spenders are seeing the economy as the glass half empty, if the latest figures on consumer confidence are anything to go by, and they are.
September saw the Consumer Confidence Index fall to a seven-month low at 48.5. The index has fluctuated this year, showing a volatile market that did not trend in one direction solidly for the last three months.
Unfavorable business conditions coupled with increasing unemployment is credited with the massive slump in consumer confidence this month, with the index far below the stable economy indicator of 90.
Lynn Franco, director of The Conference Board Consumer Research Center commented in a recent press release: "Overall, consumers' confidence in the state of the economy remains quite grim. And, with so few expecting conditions to improve in the near term, the pace of economic growth is not likely to pick up in the coming months."
Franco further stated that steady gains in employment are the real rallying card consumers need to feel confidence in the market once again. The recession may be officially over, but consumers are yet to feel the any lightening of economic pressures.
Analysts were expecting much smaller declines for the September index figure but the continuing increase in unemployment has taken its toll.
The Consumer Confidence Index is a closely monitored figure as consumer spending accounts for nearly two thirds of the Us’s economic activities. The index is based on a poll of 5,000 US households.