Washington (awp / dpa) – American consumers are worried about the resumption of the Covid-19 pandemic due to the Delta variant, and their confidence deteriorates markedly in August, falling to the lowest in nearly a decade, according to a University of Michigan survey.
For early August, the index stood at 70.2 points, a decrease of 13.5% compared to July, according to the preliminary estimate published on Friday.
This drop is also one of the strongest recorded in 50 years and the index plummets below its level of April 2020 (71.8 points), when the pandemic had just spread to the United States.
This surprised analysts, who were banking on a modest improvement, to 81.6%.
“There is no doubt that the resurgence of the pandemic due to the Delta variant arouses a mixture of reason and emotion,” said Richard Curtin, chief economist in charge of the investigation, quoted in the statement.
While consumers are “rightly concerned about a (possible) decline in the performance of the economy over the next few months”, this fall “also reflects an emotional reaction, mainly due to dashed hopes for the imminent end of the market. the pandemic “, he analyzes.
In detail, it is especially the component measuring the perception of the economic situation in the coming months which plunges (-17.5% to 65.2 points).
The component of the index measuring the current economic situation actually fell to a lesser extent: -7.8% to 77.9 points.
But the worrying progression of the Delta variant, which raises fears of new closings of shops and businesses, but also schools, is not the only worrying element.
“Consumers, employment prospects and inflation issues remain a priority,” comments Rubeela Farooqi, chief economist for High Frequency Economics.
She believes that “confidence should improve as the labor market continues to regain lost ground, although higher prices are likely to weigh on the short term.”
The job market improved sharply in July, with 943,000 jobs created and an unemployment rate falling for the second month in a row, falling to 5.4%. However, 5.7 million jobs are still missing compared to February 2020, before the pandemic.
As for inflation, it is closely watched by policymakers and economics, but appears to be showing signs of moderation that could allay fears of a lasting surge in consumer prices.
The CPI index, published on Wednesday, showed in July a slowdown over one month (0.5%) and stability over one year (5.4%).
On the other hand, the wholesale prices of goods and services (PPI index) rose in July identical to that of June (1%), but this reached a record level compared to July 2020 (7.8% ).
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