Consumer sentiment in America has weakened this month to its lowest level in nearly a year as fears about the economy continue to mount again.
The reversal in sentiment is dramatic. In June, it reached its strongest level in nearly two-and-a-half years amid hopes of better job and credit conditions, according to the latest survey by Thomson Reuters and the University of Michigan.
The survey's preliminary July reading on the overall consumer sentiment index plummeted to 66.5 from 76.0 in June – below the median forecast of 74.5 among economists polled by Reuters.
"Income and job prospects were extraordinarily weak and those bleak prospects have made consumers much more cautious spenders," said Richard Curtin, the director of the surveys.
The steep pullback in sentiment is ominous for US economy, which is already showing signs of slowing. Consumer spending accounts for 70 per cent of the American economy.