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The latest spike in COVID-19 infections has already reduced restaurant reservations, air travel and hotel occupancy in the United States.
Through Bloomberg
U.S. consumer confidence fell in August to its lowest level in six months, suggesting that concerns about the delta variant and high prices weigh on Americans’ views on the economy today and in the months to come.
The Conference Board index fell to 113.8 from a revised reading of 125.1 in July, according to the group’s report on Tuesday. Economists in a Bloomberg survey had called for a drop to 123.
The numbers suggest that the spread of the delta variant has shaken consumer opinion on the economy and threatens to undermine spending on services. The latest spike in Covid-19 infections has already reduced restaurant reservations, air travel and hotel occupancy. At the same time, Americans are paying more at the grocery store and gas pump, which could weigh on sentiment more.
Stocks fluctuated as a result of the report and Treasury yields edged up.
The numbers follow the University of Michigan Consumer Confidence Index, which plunged to the lowest level since 2011 in August as Americans grew concerned about the outlook for the economy, inflation and the recent increase in coronavirus cases.
“Concerns about the Delta variant – and, to a lesser extent, rising gas and food prices – have resulted in a less favorable view of current economic conditions and near-term growth prospects,” Lynn Franco, senior director of economic indicators at the Conference Board, said in a statement.
The Conference Board’s current conditions gauge fell to 147.3, the lowest reading since April. Consumer opinions on current trading conditions have waned, while economic expectations fell to 91.4, a seven-month low.
Consumers were less optimistic about their future incomes and employment prospects. The share of consumers who said jobs were “plentiful” fell slightly from a decades-high.
Consumers said they were slightly less likely to buy cars, homes and appliances. Vacation plans for the next six months have increased slightly.
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