The headline Consumer Confidence Index fell to 109.3 in September—a seven-month low—from 115.2 in July in another sign that the delta variant is dampening consumer optimism and spending.
Concerns about the economy prompted consumers to plan to buy less as the six-month buying intentions for homes, autos and major items all declined again in September, according to data released by the Conference Board on Tuesday.
Although consumer expectations on short-term inflation ticked down slightly to 6.5% in August from 6.7% in July, it remained elevated, also dampening spending intentions.
The labor differential index—a leading indicator for monthly employment—inched down to 42.5 in September from an upwardly revised 44.4 in August.
This data will be subjected to further revision, yet it continued to point to a tight labor market as the unemployment rate is expected to decline in September.
Overall, consumer confidence suggests a softer spending period in September and in the coming months as the delta variant persists. We expect this spending trend will also show up in the personal spending report that will be published on Friday.
For more information on how the coronavirus pandemic is affecting midsize businesses, please visit the RSM Coronavirus Resource Center.