US consumer confidence hits 12-year low amid rising spending

United States consumer confidence has reached its lowest level since 2014, according to The Conference Board, which reported a 6.7-point drop to 81.9 in September. Similarly, the University of Michigan's consumer sentiment index fell to 48 points in October, marking one of the lowest levels in the survey's history.

Despite this growing pessimism, economic data shows a disconnect between sentiment and behavior. US consumer spending increased by 0.9% in August, while personal income rose by 0.2%. Additionally, the personal saving rate fell to 4.1%.

Experts warn business leaders against treating survey data as a direct forecast of future behavior. Kari Butcher of Burson notes that companies risk making errors, such as reducing inventory based on low confidence scores, while actual consumer demand remains strong. This distinction is particularly critical as the economy remains a primary concern for 84% of registered voters ahead of midterm elections.