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Economy in Brief

U.S. Consumer Confidence Nears Expansion High
by Tom Moeller  June 30, 2015

The Conference Board's Consumer Confidence Index increased 7.2% this month to 101.4 from 94.6 during May, revised from 95.4. It was the second firmest reading during the economic expansion and stronger than forecasts for 96.8 in the Action Economics Survey. During the last ten years, there has been a 45% correlation between the level of confidence and the three-month change in real personal consumption expenditures.

The consumer expectations component improved 9.7% to 94.6 (9.5% y/y) and attained the highest level in three months. The present situations figure gained 4.2% to 111.6 (29.3% y/y), the highest level in four months.

The percentage indicating that business conditions would get better rose to 18.5%, the highest level since January. Eighteen percent of respondents thought there would be more jobs, the most since last August. The expected inflation rate ticked up to 5.1%, its highest level in three months and 5.9% planned to buy a home, the most since November. Moving the other way, 46.5% planned to purchase a major appliance, the fewest since January.

Respondents indicating that current business conditions were good rose to the highest level in three months. Jobs were viewed as hard to get by a reduced 25.7% of respondents, just above the recovery low of 24.6%. Jobs were viewed as not so plentiful by 52.9% of respondents, down from the high of 55.5 six months ago.

Confidence rose in the two older age groups. Those over age 55 logged a 10.5% improvement, 22.9% y/y. Respondents between the ages of 35 to 54 showed greater confidence by 5.4% (15.7% y/y). In the younger age bracket 1.0% fewer respondents (+10.0% y/y) were confident.

The Consumer Confidence data is available in Haver's CBDB database. The total indexes appear in USECON and the market expectations are in AS1REPNA.

The Simulative Effect of Redistribution from the Federal Reserve Bank of San Francisco can be found here.

Conference Board (SA, 1985=100) Jun May Apr Y/Y % 2014 2013 2012
Consumer Confidence Index 101.4 94.6 94.3 17.4 86.9 73.2 67.1
  Present Situation 111.6 107.1 105.1 29.3 87.3 67.6 49.8
  Expectations 94.6 86.2 87.1 9.5 86.6 77.0 78.6
Consumer Confidence By Age Group
  Under 35 Years 116.1 117.3 115.1 10.0 106.6 93.1 86.5
  Aged 35-54 Years 105.5 100.1 96.2 15.7 92.4 76.8 68.5
  Over 55 Years 90.3 81.7 80.7 22.9 73.8 61.2 56.7
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