U.S. consumer confidence fell to its lowest level in seven months in September, underscoring lingering worries about the strength of the economic recovery.
But in a sign of stabilization in the housing market, U.S. home prices hovered above multi-year lows without the homebuyer tax credit that ended in April.
The day’s data is the latest to give a mixed signal on the economy, with a 9.6 percent unemployment rate and still-tight access to credit among factors hurting consumers and keeping concerns about a double-dip recession alive.
“With unemployment at a 26 year high, confidence among consumers remains weak. This decline in sentiment will give the Fed a stronger reason to increase stimulus in November,” said Kathy Lien, director of currency research at GFT in New York.
The Federal Reserve said last week it was prepared to put more money into the economy, if needed, to stimulate the recovery and avoid deflation.