August consumer sentiment

WASHINGTON (MarketWatch)
A reading of consumer sentiment for August was revised slightly higher, but still shows a lack of faith in the U.S. economy, according to a report released Friday.
The final University of Michigan/Thomson Reuters index slipped to 55.7 in August from 63.7 in July, the worst level since Nov. 2008, though the gauge was higher than the initial August reading of 54.9.
Economists surveyed by MarketWatch had expected a final August reading of 56.5. August‘s reading represented a 13% drop from July levels and a 19% nosedive from August 2010.
The 25% decline over three months is the second largest on record.
The index of consumer expectations stumbled 15% from July levels and the index of current conditions fell 9%.
The debt-ceiling negotiations and ensuing downgrade of the U.S. sovereign debt rating has taken a toll on U.S. consumers who already are suffering through high unemployment, stagnant wages and a battered housing market.
Earlier Friday, the Commerce Department said the U.S. economy grew at just a 1% clip from April to June.
Economists do anticipate the July-to-September period to be a bit stronger, helped for example by a rebound in Japanese industrial output after the earthquake, but the expectations aren’t much.
“Recent volatility in consumer attitudes about the economy indicate just how fragile households believe the economic expansion is (which apparently was confirmed by this morning’s GDP report),” said Steven Wood, chief economist of Insight Economics.
Federal Reserve Chairman Ben Bernanke on Friday said it’s unclear how much the economy will be impacted by the debt-ceiling talk, stock market volatility and the European debt crisis. “It is difficult to judge by how much these developments have affected economic activity thus far, but it seems little doubt that they have hurt household and business confidence and that they pose ongoing risks to growth,” Bernanke said