NEW YORK — U.S. consumers are the gloomiest they've been since the tail end of the last prolonged recession. Inflation, sinking home values and soaring gas prices have pushed confidence to the lowest level since 1992.
Consumers' view of the economic future has never been lower, raising worries that already weak consumer spending could deteriorate further.
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”From a consumer perspective, this is the most troubling economy since the 1980s,“ said Mark Vitner, an economist at Wachovia Corp.
The Conference Board's consumer confidence index, released Tuesday, fell to 50.4 this month, the lowest reading since February 1992 and half what it was a year ago. The index dropped more steeply than expected from 58.1 in May. The consensus estimate of economists surveyed by Thomson/IFR was for a more modest decline to 56.5 for June.
Separately, home prices continued to tumble. April's decline in the Standard & Poor's/Case-Shiller home price index was the steepest since its 2000 inception.
Inflation, political flux and job insecurity have created an ”uncertainty more acute, perhaps, than any time since 9/11,“ said William Hummer, chief economist at Wayne Hummer Investments. ”I don't think this can be purged immediately by an election or anything else,“ he said.
The last prolonged U.S. recession was from July 1990 to March 1991. The most recent recession began in March 2001 and ended that November.
While the economy currently continues to grow, thanks to strong exports, ”there's a real gulf between an economy being held up by exports and what's happening in people's everyday lives,“ Wachovia's Vitner said.