Trump’s trade war impact on consumer confidence in USA

The confidence of US consumers in the economic development of the country declined in July to a six-month low - primarily because of concerns about new customs tariffs on imports of goods into the United States. The US consumer confidence index fell to 97.1 points in July from 98.2 points in June, with a median forecast in the financial markets for a much modest decline to 98.0 points, the lowest level of the January index here.

Despite the surprising deterioration the July index level remained close to the average of 97.7 in the previous twelve months and is still 4% above the year-ago rate thanks to robust job growth employment and very low unemployment.

So far, job and income growth has been able to offset higher inflation and interest rates. However, the clouds on the horizon are due to growing concerns about the potential negative impact of customs tariffs on the national economy. Fears of the negative impact of high tariffs have increased recently, rising from 15%, according to surveyed Americans in May, to 21% in June and to 38% in July. The consumer expectations index for future economic activity improved slightly to 86.4 points from 86.3 points a month earlier, while the index defining the current US consumer rating for the country's economic conditions fell sharply in July to 113.9 points from 116.5 points in June.