U.S. consumer confidence reached its highest level in six months this August, reflecting growing optimism about the economy.
U.S. consumer confidence reached its highest level in six months this August, reflecting growing optimism about the economy. However, concerns about the labor market have also risen, driven by an increase in the unemployment rate, which climbed to 4.3% last month—its highest point in nearly three years.
The shift in sentiment comes as Federal Reserve Chair Jerome Powell and other central bank policymakers turn their focus from controlling inflation, which is moving closer to the Fed's 2% target, to addressing labor market concerns. Powell hinted last Friday that interest rate cuts may be on the horizon.
"Consumers showed mixed feelings in August," noted Dana M. Peterson, chief economist at The Conference Board. "While they were more optimistic about both current and future business conditions compared to July, their concerns about the labor market deepened."
Peterson added, "Although consumers' views on the current labor market remain generally positive, their outlook has weakened. This likely reflects the recent rise in unemployment. Additionally, consumers were slightly less confident about their future income prospects."
The Conference Board's consumer confidence index climbed to 103.3 in August, marking its highest level since February. This was up from a revised 101.9 in July and exceeded economists' expectations, who had forecast the index to remain relatively stable at 100.3.
