The Conference Board Consumer Confidence Index, which decreased sharply in August, posted a gain in September. The Index now stands at 104.5 (1985=100), up from 100.2 in August. The Present Situation Index increased to 127.7 from 123.9. The Expectations Index rose to 89.0 from 84.4 last month.
“A more favorable assessment of current conditions coupled with a less pessimistic short-term outlook boosted consumer confidence this month,” said Lynn Franco, director of The Conference Board Consumer Research Center. “However, even though consumers’ concerns have eased, there is little to suggest a significant change in economic activity as we enter the final quarter of 2006.”
Consumers’ appraisal of ongoing conditions improved in September. Those claiming conditions are “good” increased to 27.4 percent from 26.2 percent. Those claiming conditions are “bad” eased to 15.4 percent from 16.6 percent. Labor market conditions were mixed. Consumers saying jobs are “plentiful” improved to 25.9 percent from 24.5 percent. Those claiming jobs are “hard to get,” however, edged up to 21.3 percent from 21.1 percent in August.
Consumers’ outlook for the next six months was less pessimistic in September than in August. Those anticipating business conditions to worsen decreased to 10.6 percent from 12.9 percent. Those expecting business conditions to improve, however, remained virtually unchanged at 16.3 percent.
The outlook for the labor market improved moderately. Respondents expecting more jobs to become available in the coming months edged up to 14.4 percent from 14.2 percent in August. Those expecting fewer jobs decreased to 17.1 percent from 18.1 percent. The proportion of consumers anticipating their incomes to increase in the months ahead rose to 19.7 percent from 17.9 percent.
The Consumer Confidence Survey is based on a representative sample of 5,000 U.S. households. The monthly survey is conducted for The Conference Board by TNS, a custom research company. The cutoff date for September’s preliminary results was Sept. 19.