Consumer Confidence Falls While U.S. Economy Edges Forward

August 29, 2001

Consumer Confidence Falls While U.S. Economy Edges Forward

Two important economic indicators show the U.S. economy is still growing, but consumer confidence continues to decline. The U.S. economy barely moved forward in the second quarter, growing at a rate of 0.2%, the weakest performance in eight years. The Conference Board's Consumer Confidence Index declined again in August to 114.3, down from 116.3 in July. The Present Situation Index fell from 151.3 to 145.8, but the Expectations Index rose from 92.9 to 93.3.

"The deteriorating U.S. job market dampened consumer spirits this month," says Lynn Franco, director of the Conference Board's Consumer Research Center. "This suggests rising unemployment ahead. The nation's employment and unemployment numbers now bear watching since continued weakness in the job market could translate into slower consumer spending."

The Consumer Confidence survey is based on a representative sample of 5,000 U.S. households.

- by Julia M. Duncan