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Consumer sentiment weakens in September

U.S. consumer sentiment took a surprise spill in September, according to a survey released Friday, suggesting Americans continue to be uncertain about the economic outlook and the job market.
/ Source: Reuters

U.S. consumer sentiment took a surprise spill in September, according to a survey released on Friday, suggesting Americans continue to be uncertain about the economic outlook and the job market.

The University of Michigan’s index of consumer confidence fell to 94.2 in September from 95.9 in August, according to market sources who saw the subscription-only report. Analysts had been looking for a slight rise to 96.0.

The current conditions component slipped to 103.7 from 107.9 while the expectations index edged lower to 88.0 from 88.2.

“Sentiment appears to be on a bit of a plateau, not as high as we might like it to be, but certainly better than it was a year or so ago,” said Patrick Fearon, an economist with A.G. Edwards & Sons in St. Louis.

The health of the job market continues to be a driving concern for Americans, especially as the record price of oil threatens to hamper spending, which accounts for about two-thirds of the economy.

The government’s payrolls report for September is due next week. Economists predict that the economy generated 155,000 new jobs last month compared with 144,000 jobs in August, although that forecast could change in the days ahead of the report.

The drop in the University of Michigan’s index for September differs from a rise in another gauge of consumer confidence from the Conference Board, a private business group.

Analysts sometimes use consumer sentiment as a measure of spending patterns, although there has been little correlation in the past few years between confidence and retail sales.