According to Bloomberg News, consumer spending in the United States dropped to a nine-month low in November due to increasing inflation and a rise again in the number of Covid cases that changed the economic outlook of the Americans.
The Conference Board’s index dropped to 109.5 from 111.6 recorded in October as per a report provided by the group Tuesday. The Bloomberg economist in the survey had called for a decline to 110.9.
According to Lynn Franco, who is working as a senior director of economic indicators, Conference Board stated, “Expectations about short-term growth prospects ticked up, but job and income prospects ticked down”. Lynn Franco also said that due to the concerns about price rise and to some extent the delta variant proved to be the main cause for a decline in consumer confidence.
Fostered by growth in jobs, robust wage gains, coupled with the record price of high stocks have been better and above levels as seen during the earlier stages of the pandemic. However, the surge in Covid cases again, and a rate of inflation that has been quite high in decades has proved to be a jolt in the sustained recovery in the confidence of the Americans.
The measure of the group’s current condition dropped since April to the lowest and so has the expectations in the future. While consumer confidence fell, the level to which it fell is still well above what it was on average in the last 10 years.
The difference that has been recorded between the current figures and that of the previous years is due to the labor market as emphasized by Conference Board. The percentage of consumers that said that there were plenty of jobs increased to 58%, a new record high.
Bloomberg News reports that consumers were less optimistic about jobs and prospects over the next 6 months. As per a few Americans, few have also been planning to buy homes, major home appliances, and cars over the next six months.
The figures have come in before the employment report for November comes in and says that more than half a million jobs were added to the jobs in the US.
