The headline consumer confidence index released by the Conference Board on Tuesday declined to 113.8 in August from a downwardly revised 125.1 in July in the latest sign that the spread of the delta variant is beginning to weigh on the economy.
The decline brings the index to the lowest level since February and is a reflection of consumers’ recent restraint in spending. While confidence remains higher than the low levels of last year, August’s figure is below the pre-pandemic level in 2019, which was above 120.
The Labor Differential Index, which tracks the monthly unemployment rate, inched down to 42.8, from 44.1 in July. But this decline still implies a tight labor market that will continue to contribute to a lower unemployment rate in August. That figure, along with other jobs data, will be published on Friday.
Also in the Conference Board’s report, six-month spending on home, autos and major appliances were all slightly down from the prior month, while vacation intentions continued to rise.
The takeaway
Even with the somewhat sobering data in the August report, it is still too soon to suggest a significant drop in spending in the next couple of months.
For more information on how the coronavirus pandemic is affecting midsize businesses, please visit the RSM Coronavirus Resource Center.
