Consumer confidence in the United States declined to its lowest level in over a decade in September, as elevated prices and stagnant wages continue to affect household sentiment amid ongoing geopolitical tensions. The Conference Board reported that its Consumer Confidence Index dropped by 6.7 points to 81.9 last month, down from 88.6 in August. This marks the weakest reading since April 2014 and falls below the lowest levels recorded during the COVID-19 pandemic.
The decline reflected a worsening perception of both current economic conditions and near-term expectations. Respondents’ assessment of their present situation fell 7.9 points to 109.3, while their short-term outlook dropped 5.9 points to 63.6. Write-in feedback collected from September 1 to 23 showed widespread concern about rising costs, with many citing high prices for gasoline, goods, and services as key issues.
Dana Peterson, chief economist at the Conference Board, noted the deterioration followed two months of softening confidence and highlighted that consumers’ views of current business conditions turned negative for the first time since September 2024. The decline in sentiment comes as inflation remains elevated despite recent policy efforts to contain it.
The U.S. Labor Department reported that the Consumer Price Index (CPI) increased by 3.4% year-over-year in August, matching July’s rate, but with sharper monthly gains—rising 0.4% from July compared to 0.1% the previous month. Gasoline prices averaged $4.46 per gallon for regular fuel, contributing to ongoing inflationary pressures. Other categories such as appliances, car repairs, and wireless services also saw notable price increases.
In response to persistent inflation, the Federal Reserve raised its benchmark interest rate by a quarter percentage point two weeks ago—to about 3.9%—marking its first increase since 2023. The central bank indicated that additional hikes could follow before the end of the year, a move expected to raise borrowing costs for consumers on mortgages, auto loans, and credit cards.
Meanwhile, the labor market showed mixed signals. Although consumer perception of the job market weakened, it remained broadly positive. August saw a surprising addition of 162,000 jobs, ending a summer marked by slow hiring, while the unemployment rate held steady at 4.1%. Some analysts note this rate may partly reflect discouraged job seekers leaving the workforce. Average hourly wages grew by 3.1% year-over-year in August—the slowest pace since May 2021—limiting households’ ability to keep up with inflation.
The combination of rising prices and modest wage growth has heightened economic concerns as the country approaches the midterm elections in just over a month. President Donald Trump and Republican officials face potential electoral risks amid public frustration over the cost of living. Trump has attributed high prices mainly to policies of his predecessor, President Joe Biden, though inflation has persisted and intensified since Trump’s own inauguration early last year.
Further data, including the September jobs report and August Personal Consumption Expenditures (PCE) price index, are expected in the coming days to provide additional insights into the economic outlook for U.S. consumers.