The University of Michigan and Thomson Reuters said that consumer confidence fell to a 12-month low in September, according to preliminary numbers. The Consumer Sentiment Index declined from 91.9 in August to 85.7 in September, with worries about the U.S. and global economy likely weighing heavily on Americans’ minds. Indeed, the decrease in perceptions was perhaps influenced by the falling stock market values and the media focus on economic headwinds. This was most noticeable in the subcomponent measuring future conditions, which declined from 83.4 to 76.4, the lowest level year-to-date. The index examining the current economic environment was also lower, down from 105.1 to 100.3, decreasing for the third straight month.
With that said, these numbers should also be put into a larger perspective. While the drop in confidence reflects renewed economic anxieties, this measure has trended generally higher over the past couple years. For instance, in September 2013, the Consumer Sentiment Index was 77.5, and it peaked at 98.1 in January – a post-recessionary high – before pulling back for the rest of this year. We will get final numbers for this month’s index on September 25.
Chad Moutray is the chief economist, National Association of Manufacturers.