U.S. Consumer Confidence Slides to 7-Month Low Amid High Gas Prices
The Conference Board reported that the U.S. Consumer Confidence Index fell to 89.4 in August, the lowest level in seven months, as gasoline prices held above $4 per gallon nationally. The Expectations Index sank to 68.2, its lowest since January, even as the Present Situation Index jumped 6.8 points to 121.2. New home sales also fell 10.5% in July to a 607,000-unit annualized rate, reinforcing concerns about a broader economic slowdown.
The Conference Board reported that the U.S. Consumer Confidence Index eased to 89.4 in August, down 0.8 points from a downwardly revised 90.2 in July, marking the lowest reading in seven months and missing market expectations. The Present Situation Index actually jumped 6.8 points to 121.2, its first increase in three months, while the Expectations Index sank 5.8 points to 68.2, its lowest level since January.
Elevated gasoline prices, which averaged more than $4 a gallon nationally during the survey's August 3-16 window, were cited as a key pressure on sentiment, compounding concerns over inflation and the labor market outlook.
Labor-market perceptions actually improved even as forward-looking sentiment soured: 27.0% of consumers called jobs "plentiful," up from 24.4% in July, while 19.5% said jobs were "hard to get," down from 21.7%. Yet only 16.8% of consumers expected business conditions to improve over the next six months and 23.1% expected them to worsen, and households raised their 12-month inflation expectations to 5.8% from 5.6%. Dana M. Peterson, Chief Economist at the Conference Board, said consumers' view of current business conditions stayed mildly positive even as their outlook for the future turned more pessimistic, reflecting continued concern about the labor market and inflation .
Housing data released the same cycle reinforced the soft picture: new home sales fell 10.5% in July to a seasonally adjusted annual rate of 607,000 units, below the roughly 620,000-unit consensus .
The dollar edged lower against other major currencies following the confidence miss, with EUR/USD rising from about $1.1660 to $1.1675 and GBP/USD climbing from roughly $1.3626 to $1.3653, a modest move traders described as the dollar staying resilient rather than a sharp risk-off shift. Markets will next watch upcoming employment data, retail sales, and the Federal Reserve's policy stance for signs of whether the confidence pullback proves temporary or the start of a more prolonged slowdown, with gas prices and housing data likely to remain central to the consumer outlook.
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