U.S. consumer sentiment fell in August as consumers strongly reacted to the proposed September increase in tariffs on Chinese imports, according to a monthly survey released by the University of Michigan on Friday.
“Consumer sentiment declined in early August to its lowest level since the start of the year,” the university said in a release announcing the results, adding that the “losses spanned all Index components.”
The Index of Consumer Sentiment dropped to 92.1 in early August from 98.4 in July, the Current Economic Conditions index declined to 107.4 from the prior month’s 110.7, and the Index of Consumer Expectations was down 8.2 points from the previous month to 82.3, the data showed.
Those three parameters all decreased on a year-on-year basis as well, according to the results.
The survey release said consumers “strongly reacted to the proposed September increase in tariffs on Chinese imports,” with 33 percent of them citing it as the reason for their negative views.
The latest tranche of tariffs target mostly consumer goods for ordinary American families.
With regard to the rates cut by the Federal Reserve at the end of last month, consumers said the aim is “to increase apprehensions about a possible recession,” the release said.
“Consumers concluded, following the Fed’s lead, that they may need to reduce spending in anticipation of a potential recession,” it added.
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