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  5. US consumer comfort tumbles to lowest since August on revived virus fears

US consumer comfort tumbles to lowest since August on revived virus fears

Ben Winck   

US consumer comfort tumbles to lowest since August on revived virus fears
Policy2 min read
  • Soaring COVID-19 case counts throughout the US dragged consumer confidence to an eight-week low.
  • Bloomberg's index of consumer comfort fell to 46.3 last week from 46.6, its lowest level since August.
  • The decline follows steady gains in September and comes as rising coronavirus cases revive concerns of another economic shutdown.

The resurgence of COVID-19 cases in the US dragged consumer sentiment to its lowest point since August.

Bloomberg's index of consumer comfort sank to 46.3 from 46.6 last week, according to data published Thursday. The reading follows a 1.6 point drop the week prior and reverses healthy gains made through September.

While less frequently updated economic indicators show the US maintaining a steady pace of recovery, soaring coronavirus case counts risk curtailing the rebound. France and Germany announced partial lockdowns on Wednesday to stem the virus's spread in Europe. The move fueled concern of another economic shutdown in the US and led stocks to plummet in Wednesday trading.

Read more: Goldman Sachs shares 10 high-growth stocks it newly recommends buying as investors reward companies that channel cash to grow their businesses in 2021

The index rates comfort on a zero to 100 scale. It sat near 70 before the pandemic halted economic activity in March. Though the index has since recovered from its 2020 low of just below 40, it's failed to break through the halfway point.

Worsening sentiments among Republicans fueled most of the index's recent declines. Republicans' confidence in the economy sits at 63.6, its lowest point since August. Still, the reading stands well above Democrats' figure of 40.9 and independents' reading of 40.7.

The index's decline contrasts with more encouraging data out Thursday. US gross domestic product grew a record 33.1% in the third quarter, according to Commerce Department data. The reading beat the consensus economist estimate of 32% and was roughly double the next-biggest increase in history.

New US jobless claims for the week that ended on Saturday also exceeded expectations. Filings for unemployment insurance fell to 751,000 on an unadjusted basis, beating the economist estimate of 770,000. The decline comes after claims hovered above 800,000 for weeks and hinted at a stalled labor-market recovery.

Read more: Famed short-seller Andrew Left told us about his bullish positions in a magic-mushroom company and a COVID-19 test maker — and explained why he's now all-in on an online retailer he bet against barely a year ago

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