US economy- Weak consumer confidence raises alarm on US recovery
A grim reading on US consumer confidence Friday darkened the outlook for economic recovery, while news of an industrial rebound and flat inflation underscored the depths of the long recession. The University of Michigan's report that consumer sentiment in August had unexpectedly headed south rattled US and European stock markets. The sentiment index dipped to a preliminary 63.2 from 66.0 in August, confounding most analysts who had expected it to rise to 69.0.
Brian Bethune, chief US financial economist at IHS Global Insight, said the report was "a sober reminder of how much pressure households are under." Bethune cited huge cumulative declines in household wealth since the recession began in December 2007, rising unemployment and underemployment, and downward pressure on wages, salaries and benefits as companies slash costs.
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