US Consumers Uncertain About Economy's Future, Hold On To Their Money

In August 2011, American consumers' confidence about the economy dropped to levels lower than during the recession, according to a survey by the University of Michigan. A rise in consumer confidence seen at the start of the year stalled on news about oil price hikes, drops in job growth and home prices, and political fighting over the debt ceiling. The downgrading of U.S. debt by Standard & Poor's, as well as volatility in the stock markets, also shook consumers’ confidence. Absence of income growth has discouraged consumers from spending and an unwillingness to buy will restrain prospects for economic recovery in the US.