Global| Dec 28 2004Improved Assessment of Job Market Raised Consumer Confidence
by:Tom Moeller
|in:Economy in Brief
Summary
The Conference Boards Index of Consumer Confidence surged nearly ten points to 102.3 in December. Consensus expectations had been for a reading of 94.0. The latest was the highest Confidence reading since July. Jobs were viewed as [...]
The Conference Board’s Index of Consumer Confidence surged nearly ten points to 102.3 in December. Consensus expectations had been for a reading of 94.0. The latest was the highest Confidence reading since July.
Jobs were viewed as hard to get by 26.4% of survey participants, down from levels near 28% during the prior three months. Jobs were viewed as plentiful by 19.4% of survey participants, the highest since July.
During the last twenty years there has been a 51% correlation between consumer confidence and the y/y change in real consumer spending. The correlation rose to 66% during the last ten years.
The present situation index jumped 10.0% to 105.9 (+39.3% y/y). The index of consumer expectations also rose a strong 10.8% to 99.9 (-7.0% y/y), the highest level since July.
The Conference Board’s survey isconducted by a mailed questionnaire to 5,000 households and about 3,500 typically respond.
| Conference Board | Dec | Nov | Y/Y | 2004 | 2003 | 2002 |
|---|---|---|---|---|---|---|
| Consumer Confidence | 102.3 | 92.6 | 7.9% | 96.0 | 79.8 | 96.6 |
by Tom Moeller December 28, 2004
Chain store sales surged 2.7% during Christmas week on top of two weeks of strong gain, according to the International Council of Shopping Centers (ICSC)-UBS survey. During the last three weeks chain store sales jumped 5.7%. That gain edged out the previous three week high for the series since its inception in 1989.
Despite these gains, average of sales so far in December is 0.1% below the prior month due to two huge w/w sales declines the end of November.
Consumers' spending budgets benefited from another decline in gasoline prices which, for regular unleaded, fell 2.4 cents w/w to $1.791 per gallon (+21.2% y/y). For December, gasoline prices are 7.0% below November.
The latest Short Term Energy Outlook from the US Department of Energy is available here.
The leading indicator of chain store sales from ICSC edged up slightly in the latest period (+0.9% y/y).
The ICSC-UBS retail chain-store sales index is constructed using the same-store sales (stores open for one year) reported by 78 stores of seven retailers: Dayton Hudson, Federated, Kmart, May, J.C. Penney, Sears and Wal-Mart.
During the last ten years there has been a 60% correlation between y/y change in chain store sales and the change in non-auto retail sales less gasoline, as published by the US Census Department.
| ICSC-UBS (SA, 1977=100) | 12/25/04 | 12/18/04 | Y/Y | 2003 | 2002 | 2001 |
|---|---|---|---|---|---|---|
| Total Weekly Chain Store Sales | 449.9 | 437.9 | 4.3% | 2.9% | 3.6% | 2.1% |
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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