President Joe Biden has gotten more bad news amid his reelection campaign, and it is not likely that officials trying to keep him in the White House or the administration itself can explain it away before early voting begins later this year.
Consumer confidence has declined for the third consecutive month in April, reaching a 21-month low, which can be attributed to the rising costs of food and gas as well as concerns about the job market. The Conference Board reported that the consumer-confidence index dropped to 97.0 this month, down from a revised 103.1 in March. This marks the lowest level since July 2022, MarketWatch reported.
Consumer confidence often serves as an indicator of whether the economy is improving or declining. However, confidence levels have declined since the beginning of the year and currently remain significantly below the pre-pandemic peak.“Elevated price levels, especially for food and gas, dominated consumer’s concerns, with politics and global conflicts as distant runners-up,” said Dana Peterson, chief economist at the board.
“A measure that looks at how consumers feel about the economy right now dropped to five-month low of 142.9,” the outlet reported. “A confidence gauge that looks ahead six months fell even more sharply to 66.4 in April from 74.0 in the prior month. It’s the third straight reading below 80.”
Since 2022, the Expectations Index has repeatedly dipped below 80, which traditionally signals a forthcoming recession. However, the economy has continued to expand at an above-average speed. But there is a problem—an imbalance, if you will—in that an expanding economy has not translated into bettering the personal finances of tens of millions of Americans.
While the economy is performing well by many metrics, persistent inflation and elevated interest rates have eroded consumer confidence. The cost of essentials like groceries and dining out has surged, alongside recent increases in gas prices. Additionally, consumers are scaling back on big-ticket purchases due to the burden of high borrowing expenses, MarketWatch noted further. Also, the outlet added: “A new worry is a softening labor market. Americans say it’s getting harder to find a job.”
Peterson added: “Confidence retreated further in April, reaching its lowest level since July 2022 as consumers became less positive about the current labor market situation and more concerned about future business conditions, job availability, and income.”