Global| Nov 25 2008Consumer Confidence Recovered A Bit
by:Tom Moeller
|in:Economy in Brief
Summary
The Conference Board reported that its November index of consumer confidence recovered a small piece of an October collapse. The rise to a level of 44.9 followed an October decline to 38.8. Consensus expectations had been for a [...]
The Conference Board reported that its November index of consumer confidence recovered a small piece of an October collapse. The rise to a level of 44.9 followed an October decline to 38.8. Consensus expectations had been for a roughly unchanged reading of 38.1.
During the last ten years there has been a 79% correlation
between the level of consumer confidence and the y/y change in real
consumer spending.
This month's rise reflected a decrease in the percentage of respondents expecting business conditions to worsen in six months. The latest level did, however, remain near the highest since the credit crunch of 1980. A small 11.4% expected improvement in conditions. More jobs were expected by just 9.2% of respondents while a near-record 17.7% foresaw less income.
The present conditions index fell even further to the lowest level since 1992. Jobs were seen as hard to get by 37.2% of respondents, the highest since 1993 and jobs were seen as plentiful by just 8.8%. Business conditions were seen as good by just 9.9%, the lowest since 1991. Those who thought conditions were bad rose to 40.3%, also the highest since 1992.
Expectations for the inflation rate in twelve months fell further 5.9%, the lowest level since February.
The Federal Reserve announced on Tuesday that it will initiate a program to purchase the direct obligations of housing-related government-sponsored enterprises (GSEs). The text of the announcement is available here.
| Conference Board (SA, 1985=100) | November | October | Y/Y % | 2007 | 2006 | 2005 |
|---|---|---|---|---|---|---|
| Consumer Confidence Index | 44.9 | 38.8 | -48.9 | 103.4 | 105.9 | 100.3 |
| Present Situation | 42.2 | 43.5 | -63.5 | 128.8 | 130.2 | 116.1 |
| Expectations | 46.7 | 35.7 | -32.4 | 86.4 | 89.7 | 89.7 |
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.
