Global| Oct 25 2016U.S. Consumer Confidence Deteriorates
by:Tom Moeller
|in:Economy in Brief
Summary
The Conference Board reported that its Consumer Confidence index for October declined 4.7% (-0.5% y/y) to 98.6, the first decline in three months. A 2.6% rise had been expected in the Action Economics Forecast Survey. During the last [...]
The Conference Board reported that its Consumer Confidence index for October declined 4.7% (-0.5% y/y) to 98.6, the first decline in three months. A 2.6% rise had been expected in the Action Economics Forecast Survey. During the last ten years there has been a 70.0% correlation between the level of confidence and the y/y change in real PCE.
The index of confidence about the present situation fell 5.7% (+5.2% y/y), the first decline in five months. The future confidence index was off 3.8% (-5.4% y/y), down for the first time in three months.
A sharply reduced 26.2% of respondents felt that business conditions were good, the lowest level since May. A lessened 24.3% of individuals thought that jobs were plentiful, the fewest in three months. Just 22.1% thought jobs were hard to get, nearly the least of the expansion.
The outlook for future business conditions deteriorated, and the percentage who thought that there would be more jobs backpedaled to the lowest level (13.1%) since May. Expectations for the inflation rate eased to 4.8%, and reversed the prior month's rise, while an increased 61.6% thought that interest rates would rise. Plans to buy a new home improved slightly to 0.8% following sharp deterioration in September. Total plans to buy a major appliance plummeted to 46.3%, the lowest since January of last year.
By age group, confidence amongst individuals under 35 years old improved 2.3% (3.6% y/y), but remained well below the June high. This was offset by a 9.5% decline (+2.7% y/y) in confidence amongst individuals aged 55 and over. Confidence amongst those aged 35-54 fell 5.6% (-6.4% y/y) to the lowest level since May.
The Consumer Confidence data is available in Haver's CBDB database. The total indexes appear in USECON, and the market expectations are in AS1REPNA
| Conference Board (SA, 1985=100) | Oct | Sep | Aug | Y/Y % | 2015 | 2014 | 2013 |
|---|---|---|---|---|---|---|---|
| Consumer Confidence Index | 98.6 | 103.5 | 101.8 | -0.5 | 98.0 | 86.9 | 73.2 |
| Present Situation | 120.6 | 127.9 | 125.3 | 5.2 | 111.7 | 87.4 | 67.6 |
| Expectations | 83.9 | 87.2 | 86.1 | -5.4 | 88.8 | 86.6 | 77.0 |
| Consumer Confidence By Age Group | |||||||
| Under 35 Years | 119.1 | 116.4 | 122.5 | 3.6 | 116.0 | 106.6 | 93.1 |
| Aged 35-54 Years | 103.1 | 109.2 | 113.0 | -6.4 | 103.9 | 92.4 | 76.8 |
| Over 55 Years | 84.5 | 93.4 | 84.5 | 2.7 | 84.1 | 73.8 | 61.2 |
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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