Slower US consumption is a key global vulnerability

Significance

They worry about a cooling labour market and continuing high prices and interest rates. They express less certainty about their family finances and say they will be more cautious in spending. Many have borrowed to sustain their consumption over the past year, and their nervousness amounts to a significant vulnerability for an economy where household spending accounts for more than two thirds of GDP.

Impacts

• Neither of the two issues most worrying to consumers, elevated prices and interest rates, is under a president's direct control.
• Younger consumers are more optimistic about the US economy than their older counterparts.
• Although it was short-lived and technical, August's plunge in stock prices rattled consumers, pointing to the fragility of confidence.