US consumer confidence hits seven-month low on worse outlook

US consumer confidence fell in August to the lowest level since the start of 2026 on a deteriorating outlook for business conditions and the labour market.

The Conference Board’s gauge of confidence decreased 0.8 points to 89.4 after a downwards revision to the prior month, data released on Aug 25 showed. A measure of expectations for the next six months fell to the lowest level since January, even as an indicator of present conditions rose to a four-month high.

The report suggests high petrol prices and broader cost-of-living pressures alongside a slowdown in hiring continued to weigh on American households in August. Recent data showed US retail sales fell in July by the most in more than a year as consumers pulled back after strong growth in the first half of 2026.

The survey period for the report was Aug 3 to Aug 16, a span that saw average pump prices hover above US$4 a gallon as renewed hostilities in the US-Iran conflict sent oil prices higher. The US on Aug 24 announced plans to increase economic pressure on Tehran, a move that could keep fuel costs elevated if supply concerns persist.

The Conference Board survey showed that perceptions of the current state of the job market improved in August. The share of consumers who said jobs were plentiful rose, while the share saying jobs were hard to get fell. The difference between the two – a metric closely followed by economists – matched the widest reading in 2026.

Looking ahead, however, consumers were more negative about future job and income prospects. They also were less optimistic about future business conditions, though the share of respondents saying they intend to take a vacation within the next six months rose to the highest level since January.

“Anticipated spending on services pared back in August after a pop in most discretionary activities last month, as lower gas prices and the summer’s World Cup likely boosted consumer’s desire to spend in July,” the report said. “Despite this, consumers still planned to spend more overall on services over the next six months.”

A separate measure of consumer sentiment by the University of Michigan fell in August for the first time in three months as households worried about worsening business conditions and rising inflation.

The Commerce Department will release July consumer spending, income and inflation data on Aug 26. Economists expect the report to show inflation-adjusted spending stalled in July. BLOOMBERG