Unemployment dropped from 8.3% to 8.1% in August, but this was due mostly to people leaving the labor force. Just 96,000 payrolls were added last month, and the number of jobs created during June and July turned out to be lower than initially estimated. This bad news, combined with anxiety about the European economy and the US tax increases and spending cuts set to take effect at the end of 2012, leaves many wondering whether the Federal Reserve will start another wave of quantitative easing.
Consumer confidence in the US is low, according to the Bloomberg Consumer Comfort Index.
Chain-store sales beat estimates in August, with Gap reporting 9% growth in sales and Macy’s, 5.1%. “Despite a lot of challenging macroeconomic fundamentals, the American consumer finds these opportunities where they just pick themselves up and they go out and shop, and that’s what we saw [in August],” said Chris Donnelly of Accenture. A report on total retail sales for August will be released here on September 14.