News & Insights

Consumer confidence decreased 1.3 points in August to 97.4. Despite dipping slightly, the Consumer Confidence Index remained at a level similar to those of the past quarter. Among its components, the Present Situation Index and Expectations Index declined slightly, with consumers’ pessimism about the future job availability inching up while partially being offset by stronger expectations for business conditions.

The Present Situation Index, reflecting current business and labor market conditions, fell 1.6 points to 131.2. Meanwhile, the Expectations Index, which reflects consumers’ short-term outlook for income, business and labor market conditions, declined 1.2 points to 74.8, still below the recession signal threshold of 80.

Views of the current labor market situation are still poor and getting worse, with 29.7% of consumers saying jobs were “plentiful,” down slightly from July (29.9%), while 20.0% said jobs were “hard to get,” up from 18.9% the prior month and from 14.5% in January. Looking to the future, 26.8% anticipate fewer available jobs in the next six months, up slightly from 25.1% the prior month.

Mentions of tariffs were still prevalent in written responses, with consumers expressing fears they will lead to higher prices. Additionally, mentions of high prices and inflation rose again in August, and consumers’ 12-month inflation expectations picked up to 6.2% from 5.7% in July. Meanwhile, 54% of consumers, compared to 53.1% in July, expect interest rates to rise, and fewer consumers (20.9% vs. 21.4% in July) expect rates to fall.

Buying plans for cars increased in August, while buying plans for homes were stable after declining in July. Consumers’ plans for buying big-ticket items were mixed but down slightly overall in August, especially for TVs and tablets, but plans to buy washers and dryers increased. Overall, consumers’ views of their current and future financial situation improved slightly from July.