Global| Jul 25 2006Consumer Confidence Improved Unexpectedly
by:Tom Moeller
|in:Economy in Brief
Summary
Consumer confidence as reported by the Conference Board rose 1.0% in July to 106.5 and added to a 0.7% June increase that was revised down slightly from the initial report. Consensus expectations had been for a decline in confidence [...]
Consumer confidence as reported by the Conference Board rose 1.0% in July to 106.5 and added to a 0.7% June increase that was revised down slightly from the initial report. Consensus expectations had been for a decline in confidence to 104.0.
During the last twenty years there has been a 52% correlation between the level of consumer confidence and the y/y change in real consumer spending. The correlation rose to 66% during the last ten years.
The index measuring consumers' expectations rose 1.5% (-4.7% y/y). The rise mostly reflected less pessimism about the outlook for business conditions and jobs in six months rather than an outright rise in optimism about the outlook. 
Expectations for the inflation rate in twelve months held steady at a reduced 5.1%.
Consumers' assessment of the present situation recovered half of the prior month's decline and rose 0.6% (11.5% y/y). The percentage of respondents who viewed business conditions as good (27.5%) rose and the percentage that viewed jobs as hard to get (19.9%) fell.
The Conference Board’s survey isconducted by a mailed questionnaire to 5,000 households and about 3,500 typically respond.
| Conference Board | July | June | Y/Y | 2005 | 2004 | 2003 |
|---|---|---|---|---|---|---|
| Consumer Confidence | 106.5 | 105.4 | 2.8% | 100.3 | 96.1 | 79.8 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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