Global| Jun 27 2017U.S. Consumer Confidence Improves
by:Tom Moeller
|in:Economy in Brief
Summary
The Conference Board Consumer Confidence Index rose 1.1% during June (22.1% y/y) to 118.9, following a little-revised 1.5% decline during May to 117.6. The index was 4.8% below its March peak, which was its highest level since [...]
The Conference Board Consumer Confidence Index rose 1.1% during June (22.1% y/y) to 118.9, following a little-revised 1.5% decline during May to 117.6. The index was 4.8% below its March peak, which was its highest level since December 2000. The Action Economics Forecast Survey looked for a decline to 116.0. During the past thirty years, there has been a 70% correlation between the level of consumer confidence and the y/y change in real PCE.
The increase in confidence reflected a 4.1% gain (25.5% y/y) in the present situation index to 146.3, its highest level since July 2001. The expectation reading declined 1.7% (+18.9% y/y) to 100.6, down for the third straight month.
The percentage of respondents indicating that business conditions are "good" ticked higher to 30.8%, down from 32.4% three months ago. The percentage saying business conditions are "bad" eased to 12.7%. Respondents stating that jobs are "plentiful" strengthened to 32.8%, the highest percentage since August 2001. The percentage claiming jobs are "hard to get" declined to 18.0%, also a 16 year low. These changes in views on labor market conditions led to a slightly higher labor market differential (a reliable indicator of the unemployment rate) of 14.8 percentage points, remaining near its 2001 high.
The percentage expecting business conditions to improve over the next six months eased to 20.4%, down sharply from its 26.9% March peak. For labor markets, the percentage expecting more jobs in the months ahead rose slightly to 19.3%, but remained below the 23.8% March peak. The percentage of consumers expecting their incomes to strengthen rose to 22.2%, up from the 2009 low of 7.8%.
The expected rate of inflation in twelve months eased to 4.6%, the lowest level in six months. The percentage expecting higher interest rates over the next twelve months declined to 66.6%, down from a high of 72.2% three months ago.
Confidence amongst individuals over age 55 improved slightly, but remained below the cycle high reached three months ago. Confidence amongst individuals aged 35-to-54 also improved, but remained below the March high. Confidence amongst respondents under age 35 eased slightly, but remained near the 2000 high.
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) | Jun | May | Apr | Y/Y % | 2016 | 2015 | 2014 |
|---|---|---|---|---|---|---|---|
| Consumer Confidence Index | 118.9 | 117.6 | 119.4 | 22.1 | 99.8 | 98.0 | 86.9 |
| Present Situation | 146.3 | 140.6 | 140.3 | 25.5 | 120.6 | 111.7 | 87.4 |
| Expectations | 100.6 | 102.3 | 105.4 | 18.9 | 86.1 | 88.8 | 86.6 |
| Consumer Confidence By Age Group | |||||||
| Under 35 Years | 136.5 | 138.0 | 128.6 | 3.2 | 122.4 | 116.0 | 106.6 |
| Aged 35-54 Years | 123.0 | 119.5 | 121.7 | 17.5 | 106.2 | 103.9 | 92.4 |
| Over 55 Years | 109.2 | 107.3 | 112.5 | 47.8 | 84.6 | 84.1 | 73.8 |
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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