Lowest level since 2011: US consumer sentiment collapses

Lowest level since 2011
US consumer sentiment collapses

The prices go up, the mood goes down. Americans are buying as little as they last did in December ten years ago. In a survey, they are pessimistic. The extent of shopping fatigue comes as a surprise to economists.

Due to the sharp rise in prices, the mood of US consumers deteriorated more sharply in August than it has been since December 2011. The consumer mood barometer dropped to 70.2 from 81.2 in July, the University of Michigan said, citing its monthly poll. Economists, on the other hand, had expected stagnation.

According to the preliminary results, consumers assessed their current situation as worse than before. Their expectations for the coming months also fell significantly. With a view to the next twelve months, they expect goods and services to become more expensive by 4.6 percent.

As in many other regions of the world, inflation in the USA has recently risen sharply – for example due to delivery bottlenecks and as a result of the Corona crisis. Goods and services again cost 5.4 percent more in July than in the same month of the previous year. A similarly high value was last recorded in August 2008.

US consumers are hugely important to the US economy. Around 70 percent of the gross domestic product depends on private consumption.