Global| Oct 29 2013U.S. Consumer Confidence Deteriorates Amongst Young and Old Alike
by:Tom Moeller
|in:Economy in Brief
Summary
The Conference Board's Consumer Confidence Index fell to 71.2 this month versus 80.2 during September, last month reported as 79.7. The level of the confidence index peaked at 82.1 in June. Consensus expectations were for a decline to [...]
The Conference Board's Consumer Confidence Index fell to 71.2 this month versus 80.2 during September, last month reported as 79.7. The level of the confidence index peaked at 82.1 in June. Consensus expectations were for a decline to 75.0. During the last ten years, there has been a 47% correlation between the level of confidence and the three-month change in real PCE.
The consumer confidence index for those aged less than 35 years deteriorated the most m/m, reversing nearly all the of gains since March. The index for individuals over 55 years old also fell sharply to the lowest level since March. Confidence amongst middle-agers fell sharply to the lowest level since May.
The decline in overall level of confidence was greatest in the consumer expectations reading to 71.5 from 84.7. The percentage of who thought that business conditions and employment gains would improve during the next six months fell sharply. Expectations for the inflation rate in twelve months rose to 5.5%. A lessened 64.6% felt interest rates would rise but that still was up sharply from the Q3'12 figure of 45.4%. Plans to buy a new home fell but plans to buy major appliances rose.
Consumer's assessment of the current economic environment also fell but just moderately to a reading of 70.7. A lessened percentage thought that business conditions were good. Jobs were viewed as hard to get by a slightly higher 35.8%, but that remained nearly the least in five years.
The Consumer Confidence data is available in Haver's CBDB database.
| Conference Board (SA, 1985=100) | Oct | Sep | Aug | Y/Y % | 2012 | 2011 | 2010 |
|---|---|---|---|---|---|---|---|
| Consumer Confidence Index | 71.2 | 80.2 | 81.8 | -2.6 | 67.1 | 58.1 | 54.5 |
| Present Situation | 70.7 | 73.5 | 70.9 | 24.7 | 49.8 | 36.1 | 25.7 |
| Expectations | 71.5 | 84.7 | 89.0 | -14.9 | 78.6 | 72.8 | 73.7 |
| Consumer Confidence By Age Group | |||||||
| Under 35 Years | 85.9 | 109.4 | 104.5 | -12.6 | 86.5 | 77.3 | 70.4 |
| Aged 35-54 Years | 80.8 | 87.4 | 90.0 | 8.7 | 68.5 | 59.8 | 55.1 |
| Over 55 Years | 55.3 | 62.9 | 64.9 | -9.2 | 56.6 | 47.3 | 47.4 |
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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