According to a Gallup poll, Americans’ confidence in the economy has deteriorated more in the past week than at any time since the collapse of Lehman Brothers in 2008.
Gallup’s Economic Confidence Index fell 12 points in the last week. The famous polling company attributed the drop to the ongoing government shutdown and uncertainty over the raising of the debt ceiling. Following the collapse of Lehman Brothers in 2008, which triggered the worldwide financial crisis, consumer confidence fell 15 points.
Overall, Gallup’s measure of consumer confidence now stands at -34, its lowest level since December 2011.
Gallup noted that consumer confidence had been steadily improving in general, and that its Economic Confidence Index seemed poised to enter positive territory in late May and early June. However, it never did and had grown more negative since.
Wrangling over the debt ceiling and government operations has led to confidence drops in the past, said the organization. For example, on Feb. 20, 2011, when Congress and President Obama failed to reach an agreement to avoid automatic federal spending cuts as part of sequestration, it fell 8 points, but eventually bounced back.
“While the economy is, in many respects, stronger than it was during the 2011 debt ceiling crisis, the current budget debate and government shutdown clearly show that partisan brinksmanship and the uncertainty it causes on Wall Street can negatively affect consumer confidence,” Gallup concluded.