By Gregory Korte and Ryan Haar
Republicans and independents in the US are losing faith in the economy at the steepest rates of Donald Trump’s presidency, signaling more trouble for his efforts to make economic growth a centrepiece of his re-election campaign.
The University of Michigan Consumer Sentiment Index fell in August to its second-lowest level since just before the 2016 election. But a deeper look of the numbers by party affiliation shows warning signs for Mr Trump, the survey’s director says.
“What I’d keep my eye on is the independents because whoever wins the majority of independents will win the presidency,” Richard Curtin, director of the Michigan survey, told reporters.
Voters historically had higher consumer confidence when a president of their party is in the White House. Independents saw a big boost in optimism after Mr Trump’s election but their confidence is now at the lowest level of his presidency.
Mr Curtin said the trade war with China is weighing on consumers who expect inflation to eat into their buying power. Mr Trump himself has looked at consumer confidence as a key measure of his economic policies.
“Just out: Consumer Confidence hits highest level since 2000,” he tweeted last October, as the index peaked just before the midterm elections swept Democrats into control of the House of Representatives.
This week, Mr Trump downplayed indicators suggesting a recession is becoming more likely, citing earnings by retailers.