US consumer confidence falls again in August, recession fears rise

The Conference Board (TCB) Consumer Confidence Index slipped 1.3 points in August to 97.4 (1985=100), down from a revised 98.7 in July. The Present Situation Index dropped to 131.2, while the Expectations Index eased to 74.8—remaining below the 80 threshold that often signals recession risk.

Confidence trends varied, it declined among consumers under 35, stayed steady for those aged 35–55, and improved for over-55s. Income groups showed no clear pattern. By political affiliation, confidence fell for both Republicans and Democrats but held steady for Independents.

Consumers’ assessment of business conditions showed mixed movement: 22 per cent rated them ‘good’ (up from 20.5 per cent), while 14.2 per cent said ‘bad’ (up from 13.6 per cent). Views on the labour market weakened slightly, with 29.7 per cent saying jobs were ‘plentiful’ (down from 29.9 per cent), while 20 per cent reported jobs were ‘hard to get’ (up from 18.9 per cent).

“Consumer confidence dipped slightly in August but remained at a level similar to those of the past three months. The present situation and the expectation components both weakened. Notably, consumers’ appraisal of current job availability declined for the eighth consecutive month, but stronger views of current business conditions mitigated the retreat in the Present Situation Index. Meanwhile, pessimism about future job availability inched up and optimism about future income faded slightly. However, these were partly offset by stronger expectations for future business conditions,” said Stephanie Guichard, senior economist, global indicators at The Conference Board.

Expectations for future business conditions improved modestly, with 19.5 per cent expecting an improvement and 21.9 per cent expecting worsening conditions. But labour market outlooks worsened: 26.8 per cent anticipated fewer jobs, up from 25.1 per cent. Income expectations softened, with fewer expecting gains and more anticipating declines, TCB said in a release.

Consumers were slightly more positive about their current and expected family financial situations. However, the share of consumers expecting a recession within the next 12 months rose to 6.2 per cent in August—up from 5.7 per cent in July but still below the April peak of 7 per cent. Mentions of jobs and employment increased in open responses—negative remarks focused on current conditions, while positive ones reflected hope for improvement.

“Consumers’ write-in responses showed that references to tariffs increased somewhat and continued to be associated with concerns about higher prices. Meanwhile, references to high prices and inflation, including food and groceries, rose again in August,” Guichard added.

ALCHEMPro News Desk (HU)