According to a new survey from the Conference Board, consumer confidence in the United States has hit a new seven-month low amid concerns that the economy is slowing down. Many businesses and analysts have expected a slowdown of overall economic growth in the United States for the third quarter; this new survey from the Conference Board seems to confirm that consumers are spending less.
This latest drop in consumer confidence comes amid a rise in COVID-19 cases because of the Delta variant. While at first analysts were not expecting the Delta variant to cause too much turmoil when it comes to economic growth, data from the past few weeks and months has changed these expectations. The Delta variant does seem to be negatively impacted businesses and how consumers spend their money.
According to the new survey conducted by the Conference Board, consumers are now less interested in buying buy ticket items, such as pricey household appliances (like washers and dryers) and cars. Consumers are also less likely to buy a home now, compared to previously. The survey also reveals that consumers are not as optimistic about the labor market and therefore the economy as they were in previous surveys conducted earlier this year.
According to the survey, the consumer confidence index dropped to a reading of about 109.3 in September. In August, this reading was at 115.2. September’s reading is the third straight monthly decline. September’s reading is now the lowest reading since February of 2021.
Data has recently revealed that the economy is slowing down, possibly because of many factors. The Delta variant has continued to impact how businesses are able to run — and how consumers choose to spend their money. The loss of pandemic relief money, which previously caused a huge surge in demand and a boost in the economy earlier this year, may also be negatively impacting economic growth.
The country is also still struggling with labor and raw material shortages. Even if consumer demand continues to surge in the holiday season, these shortages could hamper the economic growth the country sees. Global supply chain bottlenecks are also continuing to affect business activity worldwide — and the Delta variant has only made matters worse in this regard. While many have high expectations for the holiday season, these supply chain issues may keep inventories and stocks low, thereby hampering the amount of money consumers spend during the busiest season of the year. While many businesses are trying their best to sort matters out before the holiday season rolls around, expectations are still worrisome for many companies.
While consumer confidence has dropped yet again, there are many analysts who are optimistic that this may change in the near future. There are some expectations that Delta will slow down in the future, causing cases to drop in the country and worldwide, which would possibly impact the economy and consumer confidence positively. If this happens, then many economists predict the United States will still experience the economic growth expected. However, this can only happen if cases of COVID-19 indeed go down in the upcoming weeks and months.