This article focuses on the consumer confidence index falling in the month of February. This is due to the concern over a possible recession. This comes as a surprise because the inflation is still about the Federal Reserve’s 2% target. In January the consumer confidence index was at 110.9 but has now fallen to 106.7. The income, business and the job market also fell in the month of February. A reading under 80 often signals an upcoming recession and it is at 79.8 for the month of February while it was at 81.5 in the month of January. The consumer confidence falling comes as a surprise because it was not anticipated but economists are not worried that there is anything to be concerned about.
This is a really interesting topic that I never really thought about until after I took an economics class. I’m interested in what the most common factor is that influences consumer confidence even when the “economy continues to show resilience” and when there have been three months of improvements. It must be that the present interest rates and inflation hold a stronger influence on the public’s perception of the economy than what is actually projected for the future.
ReplyDeleteWhen doing my newsletter, I did the small business optimism index which is similar to this. I found that in 2023, the optimism was really low, but it seems to be rising at the start of 2024. This seems to be somewhat similar to your findings in your article.
ReplyDeleteWhat do you think the real causes of this concern come from. Could it be from the media making people believe that the economy is worse than it is? If so how could we fix this problem, if there is really no cause for concern?
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