Global| Sep 27 2011U.S. Consumer Confidence Is Stable M/M But Still Low
by:Tom Moeller
|in:Economy in Brief
Summary
The Conference Board's September Index of Consumer Confidence showed stability following the harrowing August decline. The index actually ticked up slightly m/m to 45.4 following the nearly one-quarter August downdraft, which was [...]
The Conference Board's September Index of Consumer Confidence showed stability following the harrowing August decline. The index actually ticked up slightly m/m to 45.4 following the nearly one-quarter August downdraft, which was lessened slightly. The latest figure remained near the lowest since April, 2009 and it was just short of Consensus expectations for a reading of 46.0. During the last ten years there has been 47% correlation between the level of confidence and the three-month change in real personal consumption expenditures.
This month, it was consumer's reading of the present economic situation that showed a m/m decline. The index's drop to 32.5 was to its lowest since January. The reading worsened as just 11.7% saw economic conditions as good but 40.4% felt they were bad. Jobs were seen as hard to get by an increased 50.0% of respondents, the highest since May, 1983.
The expectations component of confidence edged up m/m after the 30.0% August decline. The index level was off 44.6% versus its February peak. Twice as many respondents thought that business conditions would worsen as improve. There was an even greater disparity between those who thought employment would worsen and those who saw improvement. Only 13.3% felt their income would rise, the least since October.
Expectations for inflation in twelve months fell again m/m to 5.7% versus the peak of 6.7% three months ago. A much fewer 46.4% thought interest rates would rise, the least since November and slightly more respondents foresaw higher stock prices, but 48.3% expected a decline.
The Conference Board data can be found in Haver's CBDB database. The expectation figure is the AS1REPNA database.
| Conference Board (SA, 1985=100) | Sep | Aug | Jul | Y/Y % | 2010 | 2009 | 2008 |
|---|---|---|---|---|---|---|---|
| Consumer Confidence Index | 45.4 | 45.2 | 59.2 | -6.6 | 54.5 | 45.2 | 57.9 |
| Present Situation | 32.5 | 34.3 | 35.7 | 39.5 | 25.7 | 24.0 | 69.9 |
| Expectations | 54.0 | 52.4 | 74.9 | -17.6 | 73.7 | 59.3 | 50.0 |
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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