The Conference Board Consumer Confidence Index, which had improved moderately in August, posted a slight gain in September. The Index now stands at 59.8 (1985=100), up from 58.5 in August. The Present Situation Index decreased to 58.8 from 65.0 last month. The Expectations Index, however, increased to 60.5 from 54.1 in August.
The Consumer Confidence Survey is based on a representative sample of 5,000 US households. The monthly survey is conducted for The Conference Board by TNS. The cutoff date for September’s preliminary results was Sept. 23rd.
“September’s increase in the Consumer Confidence Index was due solely to an improvement in the short-term outlook. However, these results did not capture all of the tumultuous events in the financial sector this month, and until the dust settles a bit more, we will not know the full impact on consumers expectations. Shocks, such as the 1987 crash, generally tend to have a temporary adverse effect on confidence, lasting on average two to four months, unless they result in significant job losses. Just as noteworthy, consumers assessment of current conditions continues to indicate that the current economic environment remains quite weak,” said Lynn Franco, director of The Conference Board Consumer Research Center.
Consumers appraisal of current conditions eroded further in September. Those saying business conditions are “bad” increased to 34.2% from 32.7%, while those claiming business conditions are “good” declined to 12.5% from 13.7% last month. Consumers assessment of the labor market continues to deteriorate. Those saying jobs are “hard to get” rose to 32.8% from 31.7% in Aug., while those claiming jobs are “plentiful” decreased to 12.2% from 13.5%.
Consumers short-term outlook improved again, but overall remains grim. Those anticipating business conditions to worsen over the next six months declined to 21.3% from 25.2%, while those expecting conditions to improve rose to 13.5% from 12.0%.
The outlook for the job market also moderately improved. The percent of consumers anticipating fewer jobs in the months ahead declined to 26.8% from 30.0%, while those anticipating more jobs increased to 11.8% from 10.7%. The proportion of consumers expecting their incomes to increase in the months ahead decreased slightly to 14.2% from 15.4%.
