Consumer Confidence Improves in September

The confidence level of U.S. consumers improved this month, buoyed by a more favorable assessment of current economic conditions, according to a recent report by The Conference Board.
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Following a sharp decline in August, the Board's Consumer Confidence Index increased to 104.5 in September, up from 100.2 in August. The Present Situation and Expectations indexes also improved, rising to 127.7 and 89, respectively. Despite the gain in consumer confidence, "there is little to suggest a significant change in economic activity as we enter the final quarter of 2006," said Lynn Franco, director of The Conference Board Consumer Research Center.

According to the report, more Americans are optimistic about jobs and incomes in the months ahead. The proportion of consumers anticipating more jobs to open up increased from 14.2 percent to 14.4 percent in September, and the percentage of consumers anticipating their incomes to increase in the near-term edged up to 19.7 percent from 17.9 percent in August.

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The Conference Board Consumer Confidence Index Posted a Gain in September

The Conference Board Consumer Confidence Index, which decreased sharply in August, posted a gain in September. The Index now stands at 104.5 (1985=100), up from 100.2 in August. The Present Situation Index increased to 127.7 from 123.9. The Expectations Index rose to 89.0 from 84.4 last month.

The Consumer Confidence Survey is based on a representative sample of 5,000 U.S. households. The monthly survey is conducted for The Conference Board by TNS. TNS is the world's largest custom research company. The cutoff date for September's preliminary results was September 19th.

Says Lynn Franco, Director of The Conference Board Consumer Research Center: "A more favorable assessment of current conditions coupled with a less pessimistic short-term outlook boosted consumer confidence this month. However, even though consumers' concerns have eased, there is little to suggest a significant change in economic activity as we enter the final quarter of 2006."

Consumers' appraisal of ongoing conditions improved in September. Those claiming conditions are "good" increased to 27.4 percent from 26.2 percent. Those claiming conditions are "bad" eased to 15.4 percent from 16.6 percent. Labor market conditions were mixed. Consumers saying jobs are "plentiful" improved to 25.9 percent from 24.5 percent. Those claiming jobs are "hard to get," however, edged up to 21.3 percent from 21.1 percent in August.

Consumers' outlook for the next six months was less pessimistic in September than in August. Those anticipating business conditions to worsen decreased to 10.6 percent from 12.9 percent. Those expecting business conditions to improve, however, remained virtually unchanged at 16.3 percent.

The outlook for the labor market improved moderately. Those expecting more jobs to become available in the coming months edged up to 14.4 percent from 14.2 percent in August. Those expecting fewer jobs decreased to 17.1 percent from 18.1 percent. The proportion of consumers anticipating their incomes to increase in the months ahead rose to 19.7 percent from 17.9 percent.