NEW YORK / RankWire.AI / – U.S. consumer confidence dropped sharply in September, reaching its weakest level since April 2014. The Conference Board said its Consumer Confidence Index fell 6.7 points to 81.9. The August reading was revised lower to 88.6. The September survey covered responses collected from September 1 through September 23. Consumers reported weaker views of present economic conditions and the six-month outlook. The decline marked a third consecutive monthly fall in overall confidence.
The Present Situation Index declined 7.9 points to 109.3 in September. That measure reflects consumer views of current business and labor market conditions. The Expectations Index fell 5.9 points to 63.6, also posting a third monthly decline. It tracks expectations for income, employment and business conditions over the next six months. The readings showed that concerns extended beyond current conditions. Households also became less positive about the economic environment ahead.
Views of current business conditions weakened during the month. About 18.5% of consumers described conditions as good, compared with 18.8% in August. The share calling conditions bad increased to 20.4% from 17.3%. Labor market assessments also moved lower. Some 23.6% said jobs were plentiful, down from 24.5% in August. Meanwhile, 21.9% said jobs were hard to get, compared with 20.3% one month earlier.
Inflation expectations climb as gasoline prices rise
Consumers also reported higher expectations for inflation over the next year. Average 12-month inflation expectations rose 0.3 percentage point to 6.1%. The median measure increased to 5.1%. Federal data showed consumer prices rose 3.4% in August from a year earlier. The U.S. Bureau of Labor Statistics reported a 3.9% monthly increase in gasoline prices. AAA placed the national average for regular gasoline near $4.46 a gallon on September 29.
The survey also recorded softer spending plans in several major categories. On a six-month moving average, plans to buy automobiles and homes both declined. Expected spending on services also moved lower during September. Consumers reported reduced plans for hotels, movies, air travel and amusement parks. Vacation intentions moved in the opposite direction. About 42.6% planned a trip within six months, up 0.5 percentage point from August. The increase came from stronger plans for domestic travel.
Business, employment and income outlooks lose ground
Expectations for business conditions, jobs and household income weakened further. Some 15.9% expected business conditions to improve, down from 17.0% in August. The share expecting conditions to worsen climbed to 25.4% from 23.3%. Only 14.0% expected more jobs to become available. Another 28.4% expected fewer jobs. Income expectations also eased. About 17.9% expected incomes to rise, while 15.4% expected their incomes to fall during the next six months.
The Conference Board also recorded weaker views of household finances. Net assessments of current family finances turned negative for only the second time since that measure began four years ago. Confidence declined across every age group on a six-month moving average. Nearly all income groups also posted lower readings. Toluna conducts the monthly online survey for The Conference Board. The September preliminary results closed on September 23, and the next Consumer Confidence Index release is scheduled for October 27.