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US Consumer Confidence Slips to Six-Month Low; Job Availability Worries Rising
U.S. consumer confidence eased to a six-month low in October amid worries about the availability of jobs in the near-term, offering more ammunition for the Federal Reserve to cut interest rates again on Wednesday, according to a Reuters report.
The Conference Board survey on Tuesday also confirmed what economists describe as a K-shaped economy, with confidence declining among consumers making an annual income of less than $75,000, but consumers earning more than $200,000 a year more upbeat. Economists argue that high-income households are keeping the economy afloat through robust consumer spending.
Lower-income households are struggling to make ends meet amid higher prices, including from President Donald Trump’s broad tariffs on imports, economists say. The Conference Board said references to prices and inflation in write-in comments to the survey remained the main topic influencing consumers’ views of the economy this month. It said while the mention of tariffs declined, the number of references remained elevated.
“Consumers are weary and for good reason, the stock market records are not helping them get jobs or put food on the table, and with store-bought goods inflation still rising, many Americans are being left behind in Trump 2.0,” said Christopher Rupkey, chief economist at FWDBONDS.
“Fed officials will likely not turn a blind eye to these sluggish consumer confidence readings and are likely to deliver on the market’s long-held expectations for an interest rate cut on Wednesday.”
The Conference Board said its consumer confidence index fell to 94.6 this month, the lowest reading since April, from an upwardly revised 95.6 in September. Economists polled by Reuters had forecast the index slipping to 93.2 from the previously reported 94.2 in September.
The decline in confidence was concentrated among consumers under the age of 35 and to a lesser extent those above 55 years, and improved among the 35 to 54 cohort. Consumers identifying as Independents reported an improvement in confidence, but the mood among Democrats and Republicans was downbeat.
The survey showed references to domestic politics were “up notably” in write-in comments, “with the ongoing government shutdown mentioned multiple times as a key concern.”
