A measure of US consumer sentiment fell to the lowest in almost seven months and ratings of the economy deteriorated amid the longest government shutdown in the country’s history.
The Bloomberg Consumer Comfort Index declined to 57.4 last week from 58.1 as a gauge of views on the buying climate slid to a 10-week low, according to a report Thursday. A measure of Americans’ ratings of their personal finances edged up.
While comfort remains elevated after rising to a 17-year high in late September, the measure has been giving up gains as the impasse in Washington idles federal workers. The University of Michigan’s preliminary January consumer sentiment index tumbled to the lowest since October 2016, while the Conference Board’s confidence gauge slumped to a five-month low in December.
With no sign of a conclusion soon for the shutdown, evidence is mounting that the closure will take a bigger toll on the economy.
White House Council of Economic Advisers Chairman Kevin Hassett said Wednesday that if the partial government shutdown extends through March, there’s a chance of zero economic expansion this quarter. Barclays Plc cut its first-quarter growth forecast, citing the shutdown: It now sees a 2.5 percent annualized rate, down from 3 percent.
The comfort gauge for those working full-time and those making more than $50,000 both fell to the weakest levels in more than six months.
Comfort for homeowners and college graduates fell to the lowest since July.
Measure for the Midwest rose to the best level in almost four months.