Consumer Confidence Hits Lowest Point Since April 2020
Over the past two weeks, economic sentiment slumped to its lowest reading since April 2020, with the HPS-CivicScience Economic Sentiment Index (ESI) declining 2.3 points to 42.9. Overall confidence in the U.S. economy sank dramatically, driving the decline along with record-low confidence in the housing market and near record-low confidence in making a major purchase.
After a slight nudge upward in the last reading, economic sentiment returned to its downward summer trend as the Delta variant surged around the country. Confidence in the U.S. economy plummeted 6.1 points to 40.5, the lowest reading since October 2019. Housing market confidence slid 0.7 points to a record low of 28.3, as home prices continued to soar. As inflation continues to pick up, consumers are quickly losing confidence about making a major purchase, with confidence falling 3.8 points to the second-lowest reading in ESI history, 32.5. Despite a strong July jobs report, labor market sentiment also fell, dropping 2.1 points to 56.5. The only indicator to rise was personal finances, increasing 1.4 points to 57.0.
The three-day moving average began on August 4 at 42.7 and oscillated for the two-week period, reaching its high of 44.9 on August 9 and closing at 44.1 on August 17.
The next release of the ESI will be Wednesday, September 1, 2021.