A tepid stock market, soaring inflation, and rising interest rates have left Americans less than optimistic about the state of the economy. Consumer sentiment has plunged to a record low, according to a University of Michigan survey released last week, fueled by frustration over high prices.
To be clear: we are not in a recession, at least not yet. But signs of an economic downturn are cropping up all over, in sectors from commodities to housing . Here’s what CNN Business reported last week:
Copper is widely used in construction materials, and it faces increased demand in an expanding economy. That demand disappears when the economy contracts.
Prices shot up earlier this year when Russia, which accounts for 4% of global copper output, invaded Ukraine. Traders who were concerned about short supply began hoarding the metal. And now, copper prices are falling.
“Copper prices are just starting to account for the fact that global growth is slowing,” Daniel Ghali, director of commodity strategy at TD Securities, told CNN Business’ Julia Horowitz.
Purchasing Managers’ Index
The Fed’s aggressive interest rate hikes are dampening the mood further.
“Business confidence is now at a level which would typically herald an economic downturn, adding to the risk of recession,” Williamson told CNN Business’ Julia Horowitz.
Consumer sentiment
The June index saw a 14.4% drop since May as consumers became increasingly alarmed about inflation. About 79% of those consumers said they expected bad times for business conditions in the upcoming year, the highest level for that metric since 2009.
The percentage of consumers who blamed inflation for eroding their living standards, 47% according to the June index, is only one percentage point lower than the all-time high reached during the Great Recession.
“As higher prices become harder to avoid, consumers may feel they have no choice but to adjust their spending patterns, whether through substitution of goods or foregoing purchases altogether,” Joanna Hsu, Surveys of Consumers director, said. “The speed and intensity at which these adjustments occur will be critical for the trajectory of the economy.”
Gas prices
The bad news: It’s because traders are betting on a…
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