Tariff and inflation concerns persist, U.S. consumer confidence drops to a three-month low
U.S. consumer confidence dropped sharply in August, falling to a three-month low, indicating that uncertainty related to tariffs and concerns about inflation continue to weigh on the economic outlook.
A survey released Friday by the University of Michigan showed that the final consumer confidence index for August fell to 58.2, down from 61.7 in July and also below the preliminary reading of 58.6. The data shows that consumers expect prices to rise at an annual rate of 4.8% over the next year, up from 4.5% last month; inflation expectations for the next 5 to 10 years are at 3.5%. Although this is an improvement from the preliminary reading of 3.9% released earlier this month, it is still slightly higher than July.
The report further pointed out that consumers' anxiety about employment and the business environment has intensified. About 63% of respondents expect the unemployment rate to rise in the coming year, a proportion not only higher than last month but also much higher than the same period last year. The market generally expects that the non-farm payroll report for August, to be released next week, will show that job growth remains moderate. Federal Reserve Governor Waller said on Thursday that he supports a rate cut in September and expects further easing in the next six months to help improve the employment outlook.
Consumers' willingness to purchase big-ticket durable goods and automobiles has significantly deteriorated. Joanne Hsu, director of the University of Michigan's survey project, pointed out: "An increasing number of consumers are mentioning high prices and tax/tariff factors, especially in terms of car-buying conditions, where the impact is particularly pronounced." This suggests that household financial pressures may further affect consumer spending, which is the main driver of U.S. economic growth.
However, another report released by the U.S. government on the same day showed that consumer spending in July posted the largest month-on-month increase in four months, supported by income growth. This data also reflects the impact of price pressures on consumer sentiment. Excluding food and energy, the core PCE price index rose 2.9% year-on-year in July, the highest level since February.
Sub-indices from the University of Michigan showed that the index reflecting future expectations fell to 55.9, a three-month low and below the preliminary reading of 57.2; the indicator measuring current conditions also dropped to 61.7 from last month. The survey was conducted between July 29 and August 25.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Ethereum's Structural Bull Case Amid Seasonal Volatility: A Buy for the Long-Term Investor
- Ethereum's 2025 rise stems from institutional adoption, regulatory clarity, and tech upgrades, not speculation. - U.S. CLARITY Act reclassified ETH as utility token, enabling 19 public companies to hold 2.7M ETH in treasuries. - Dencun/Pectra hard forks reduced gas fees by 90%, supporting 4,000+ dApps while ETF inflows hit $13.3B in 2025. - Deflationary mechanics and tokenized U.S. Treasuries drive scarcity, with 0.5% annual supply reduction and 29.6% staking participation. - Analysts project ETH could r

TSMC offers solution as Musk’s xAI sues new OpenAI engineer over trade secret theft
Share link:In this post: Musk’s xAI sued ex-engineer Xuechen Li for allegedly stealing xAI secrets and joining OpenAI. xAI seeks damages and a restraining order, though OpenAI itself is not named as a defendant. TSMC launched a global trade secrets registry system to help companies like xAI systematically protect IP.
Germany’s economy sinks again as Sick Man of Europe misses yet another chance to rebound
Share link:In this post: Germany’s inflation rose to 2.1% in August, beating forecasts and putting pressure on households. Unemployment hit 3.025 million, pushing the jobless rate to 6.4% as the labor market weakens. U.S. tariffs under Trump’s new trade deal are now targeting key sectors like pharmaceuticals.
Trump says court got it wrong after emergency tariffs ruled illegal
Share link:In this post: A U.S. appeals court ruled that most of Donald Trump’s tariffs are unlawful under the emergency powers law (IEEPA), but allowed them to remain until October 14 for potential Supreme Court review. Trump responded by reaffirming that the tariffs are still active and argued they are essential for protecting American industries and fighting trade imbalances. The case involved two lawsuits challenging the president’s authority to impose tariffs without explicit approval from Congress.

Trending news
MoreCrypto prices
More








