Recent Updates

  • Japan: First 10 Days Trade (Jun), Loans and Discounts Outstanding, Banking Accounts - Regional Banks, Financial Institutions Accounts (May), Wholesale & Retail Trade (May-Prelim)
  • Korea: Economic Sentiment and Business Survey Index (Jun)
  • BIS: Consumer Prices (May)
  • Brazil: PPI (May); Argentina: Registered Employment (Q4)
  • US: IIP with revisions (Q1), Adv Trade & Inventories (May)
  • Retail Sales by Province and Autonomous Community (May)
  • more updates...

Economy in Brief

U.S. Consumer Confidence Improves Broadly
by Tom Moeller  August 30, 2016

The Conference Board's Consumer Confidence Index increased 4.6% to 101.1 (-0.2% y/y) during August from 96.7 in July, revised from 97.3. The latest figure was at the highest level since September and surpassed expectations for 97.0 in the Action Economics Forecast Survey. During the last ten years, there has been a 70% correlation between the level of confidence and the y/y change in real consumer spending.

The present situations reading of confidence rose 3.5% (6.2% y/y) to 123.0, the highest level since August 2007. The expectations reading increased 5.4% to 86.4 (-5.7% y/y), the highest level since October.

By age group, confidence amongst those aged 35-54 years rose 7.5% (2.5% y/y) to the highest level since September. Confidence amongst respondents over age 55 improved 4.7% (-2.4% y/y) to the highest level in twelve months. Amongst those aged under 35, confidence rose 0.7% (2.5% y/y), but remained below the June high.

Details show that the present situation improvement reflected a jump in the perception that business conditions were good, bringing it to the highest level since March 2001. Jobs were viewed as plentiful by the greatest percentage of respondents since 2007, and jobs were viewed as hard to get by 23.4% of respondents, near the recovery low. Expectations for business conditions in six months improved to the most favorable reading since October. Perceptions about employment opportunities also rose to the highest level since October, but the perception of income improvement was even stronger.

Higher price inflation in six months was expected by a low 4.8% of respondents. Higher interest rates in twelve months were expected by 54.3% of respondents, down from 72.6% in January.

A raised 1.4% of respondents expected to buy a new home in the next six months, the most since December. A slightly higher 50.3% intended to buy a major appliance, but 3.7% planned to buy a new car, down from 5.4% just two months ago.

The Consumer Confidence data is available in Haver's CBDB database. The total indexes appear in USECON, and the market expectations are in AS1REPNA

Projecting the Long-Run Natural Rate of Interest from the Federal Reserve Bank of San Francisco is available here.

Conference Board (SA, 1985=100) Aug Jul Jun Y/Y % 2015 2014 2013
Consumer Confidence Index 101.1 96.7 97.4 -0.2 98.0 86.9 73.2
  Present Situation 123.0 118.8 116.6 6.2 111.7 87.4 67.6
  Expectations 86.4 82.0 84.6 -5.7 88.8 86.6 77.0
Consumer Confidence By Age Group
  Under 35 Years 120.9 120.1 132.3 2.5 116.0 106.6 93.1
  Aged 35-54 Years 112.7 104.8 104.7 2.5 103.9 92.4 76.8
  Over 55 Years 84.7 80.9 73.9 -2.4 84.1 73.8 61.2
close
large image