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Bad for crypto? US Consumer Confidence declined to 102.5 in October

Bad for crypto? US Consumer Confidence declined to 102.5 in October

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TL;DR

  • The US Consumer Confidence Index dropped to 102.5 in October.
  • This indicates that consumers are becoming less willing to spend in the current economic condition.
  • Lack of spending can hamper the market and economic growth.

The latest US Consumer Confidence Index has just been released, and the result is quite disappointing. The Conference Board released the numbers on Tuesday, revealing that the Index has dropped to 102.5 (1985=100) after back-to-back monthly gains in August and September. 

US Consumer Confidence Index drops amid concerns about inflation

Consumer Confidence is indicative of consumers’ feelings about current and future economic conditions. The index counts as an important measure of the overall state of the economy. In September, the index was 107.8. The drop this month was lower than the expected number, at 105.9. 

The drop indicates a growing level of concern among consumers amid the brewing cases of inflation, perhaps. With such concerns, consumers are becoming less willing to spend, which isn’t healthy for both the market and economic growth. 

Notably, concerns about inflation—which had been receding since July—picked up again, with both gas and food prices serving as main drivers. […] Looking ahead, inflationary pressures will continue to pose strong headwinds to consumer confidence and spending, which could result in a challenging holiday season for retailers.

Lynn Franco, Senior Director of Economic Indicators at The Conference Board.

Are the crypto and stock market in trouble?

The stock and cryptocurrency market could be vulnerable in this regard because increases in Consumer Confidence somewhat support the growth and valuations of assets. Reports show that investors are more likely to confidently pay up for investment in a growing economy. 

The reverse is the case when the economy is struggling. Noteworthily, consumer spendings reportedly make up two-thirds of the economy. So, the economy could be affected when spending drops drastically.

During the time of writing, the cryptocurrency market stood at $941.61 billion, a 1% decrease over the last 24 hours. Ethereum, Cardano, and Polkadot lead the 24-hours gain for the top-20 cryptocurrency list. Bitcoin was trading at $19,581, with a daily gain of about 1.64%, according to Coinmarket data. 

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Ibiam Wayas

Ibiam is an optimistic crypto journalist. Five years from now, he sees himself establishing a unique crypto media outlet that will breach the gap between the crypto world and the general public. He loves to associate with like-minded individuals and collaborate with them on similar projects. He spends much of his time honing his writing and critical thinking skills.

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