U.S. consumer confidence plunged more than 13% in the last month to its lowest level in a decade as Americans fretted about rising inflation and surging COVID-19 infections.
The University of Michigan reported Friday its consumer sentiment index fell from 81.2 to 70.2, the lowest level since 2011 and the largest drop since the early days of the pandemic in April 2020.
“The losses covered all aspects of the economy, from personal finances to prospects for the economy, including inflation and unemployment,” survey director Richard Curtin explained.
He added that the recent surge in COVID-19 from the Delta variant was largely to blame.
“There is little doubt that the pandemic’s resurgence due to the Delta variant has been met with a mixture of reason and emotion,” Curtin said. “Consumers have correctly reasoned that the economy’s performance will be diminished over the next several months, but the extraordinary surge in negative economic assessments also reflects an emotional response, mainly from dashed hopes that the pandemic would soon end.”
Consumers also expressed concern that inflation will continue growing. Just days after the government reported it recent annual rate of 5.4% in July.