WASHINGTON — Economists have advice for anyone worried that consumers are too fearful to keep spending: Look at what they’re doing, not what they’re saying.
A survey of consumer confidence shows that Americans were spooked early this month by the standoff over the debt ceiling, a downgrade of U.S. long-term debt and a swoon in stock prices.
But maybe only temporarily.
If stock prices stay steady, consumers will likely keep spending, and the economy should improve modestly in the months ahead, economists say. Most downplayed the results of a Conference Board survey released Tuesday that showed consumers were in a gloomy mood in early August.
“They tend to register their anxiety about the future in these surveys . . . without actually curtailing their spending,” said Chris Rupkey, chief financial economist at Bank of Tokyo- Mitsubishi UFJ.
The board said its Consumer Confidence Index sank to 44.5 in August, a 15-point drop from July.
That was a much sharper fall than expected. It brought the index to its lowest level since April 2009. A reading above 90 shows solid footing.
The report coincided with similarly glum results from a survey of business and consumer sentiment in Europe. In that poll, retailers were pessimistic about the future, and consumers were fearful of losing their jobs.
For August, economists don’t expect Americans to cut their spending sharply, if at all. Most foresee that consumer spending, which drives about 70 percent of the economy, will rise faster in the July-September period than in the preceding three months.
Ken Perkins of Retail Metrics Inc., a research firm, noted that the mood of consumers has been downbeat all year. Yet sales at retail chains have remained relatively healthy.
“There’s been a little bit of a disconnect,” Perkins said. “Consumers say one thing and do another.”
