The index stands at 66.8 points, against 71.7 in October, according to the preliminary estimate of the University of Michigan survey released on Friday.

Consumers are worried about prices which continue to rise in the United States.

"Rising prices for homes, vehicles and durable goods have been reported more frequently (by consumers surveyed) than at any time in more than half a century," said Richard Curtin, the economist in charge of this investigation.

Global supply difficulties, faced with strong American demand, supported by aid paid by the government, in particular, are pushing up prices.

"High inflation amid widespread supply disruptions will prevent a full recovery until 2022," warns Mahir Rasheed, economist for Oxford Economics.

These difficulties are exacerbated by the lack of handlers, workers, truck drivers, waiters, or even salespeople.

All sectors are concerned, and this ultimately has repercussions on the end customer.

Rising wages

"One in four consumers reported a reduction in their standard of living due to inflation," especially those with lower incomes and older consumers, said Richard Curtin

Wages have certainly increased, but not enough to compensate for the rise in prices.

"Half of the families (interviewed) predicted a reduction in real income next year," said Richard Curtin.

Target store in Hollywood (California) hires, wages from 16.75 dollars an hour, November 9, 2021 Robyn Beck AFP

"For households, high inflation that exceeds wage increases will remain an obstacle in the short term," also commented Rubeela Farooqi, chief economist at HFE.

The labor shortage is indeed pushing up wages, but it also fuels inflation.

However, the "Great resignation" continues, employees playing the bidding between employers willing to do anything to attract candidates.

Thus, 4.4 million people left their jobs in September, a record since these data began to be collected in December 2000, said Friday the Department of Labor.

Beyond the observation on their purchasing power, consumers also have "the growing conviction (...) that no effective policy has yet been put in place", describes Richard Curtin.

The high inflation was until now expected as temporary by many economists, but also by the White House.

"Absolute priority"

But months go by, and inflation rates do not fall, even reaching in October a high since 1990: prices rose 6.2% compared to October 2020, after 5.4% in September, according to the CPI index.

This prompted Joe Biden to point out Wednesday that it was his "top priority".

Joe Biden at the port of Baltimore (Maryland) on November 10, 2021 Brendan Smialowski AFP

He is counting on the investments he hopes to pass in Congress, both to support the economy in the long term, but also to defeat inflation, in particular by increasing the growth potential of the US economy.

The American central bank (Fed) could also adapt its policy.

In normal times, such inflation would have led it to raise its key rates, but in the current context, it fears that it will harm the recovery in employment.

At its last meeting, it kept them between 0 and 0.25%, to continue to support the economy.

However, it has launched the normalization of its policy, starting to reduce its asset purchases, in order to inject less liquidity.

This move should be completed by the middle of next year, paving the way for a rate hike.

But faced with inflation, the Fed could pick up the pace.

© 2021 AFP