New York - Arabstoday
US consumer sentiment dropped to its lowest point in more than three decades in early August, as fears over stalled recovery gelled with despair over government policies, a survey released yesterday showed. The Thomson Reuters/University of Michigan\'s preliminary August reading on the overall index on consumer sentiment came in at 54.9, the lowest since May 1980, down from 63.7 in July. It was well below the the median forecast of 63.0 among economists polled by Reuters. High unemployment, stagnant wages and the protracted debate over raising the US government debt ceiling spooked consumers, polled before the downgrade of US sovereign debt by Standard &Poor\'s. \"Never before in the history of the surveys have so many consumers spontaneously mentioned negative aspects of the government\'s role,\" survey director Richard Curtin said. The survey\'s gauge of consumer expectations slipped to 45.7, also the lowest since May of 1980, from July\'s 56.0 and below a predicted reading of 55.3. The Obama administration received poor ratings from 61 per cent of respondents, the worst showing among all prior heads of state. \"This was more than the simple recognition that traditional monetary and fiscal policy measures were largely spent; it was the realisation that the government was unable or unwilling to act,\" Curtin added. Two-thirds said the economy had recently worsened, and just one in five anticipated any gains during the year ahead.