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Economy in Brief

U.S. Consumer Confidence Reaches 2007 High
by Tom Moeller  November 29, 2016

The Conference Board reported that its Consumer Confidence index for November increased 6.3% (15.7% y/y) to 107.1, the highest level since July 2007. October's level was revised up to 100.8 from 98.6. A rise to 101.1 in November had been expected in the Action Economics Forecast Survey. During the last ten years, there has been a 70.0% correlation between the level of confidence and the y/y change in real PCE.

The index of confidence about the future situation increased 6.6% (14.1% y/y) to 91.7, while the present situation index gained 5.8% (17.5% y/y) to 130.3.

An increased 29.2% of respondents felt that business conditions were good, the highest level in three months. A improved 26.9% of individuals thought that jobs were plentiful. A stable 27.1% thought jobs were hard to get, the least of the expansion.

The outlook for future business conditions deteriorated. The percentage who thought that there would be more jobs was fairly stable at 14.5%, but up from 12.0% a year ago. Expectations for the inflation rate eased to 4.7%, and matched the lowest level since February 2007. A fairly stable 62.2% thought that interest rates would rise. Plans to buy a new home recovered to 1.3% following sharp declines in the prior two months. Total plans to buy a major appliance recovered to the highest level (52.4%) sine January.

By age group, confidence amongst individuals under 35 years old jumped 7.4% (25.6% y/y) to a recovery high. Confidence amongst those aged 35-54 improved 5.5% (14.5% y/y), and neared the recovery high. Confidence amongst those 55 and over rose 6.3% (14.5% y/y).

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) Nov Oct Sep Y/Y % 2015 2014 2013
Consumer Confidence Index 107.1 100.8 103.5 15.7 98.0 86.9 73.2
  Present Situation 130.3 123.1 127.9 17.5 111.7 87.4 67.6
  Expectations 91.7 86.0 87.2 14.1 88.8 86.6 77.0
Consumer Confidence By Age Group
  Under 35 Years 133.3 124.1 116.4 25.6 116.0 106.6 93.1
  Aged 35-54 Years 112.8 106.9 109.2 14.5 103.9 92.4 76.8
  Over 55 Years 89.9 84.6 93.4 14.5 84.1 73.8 61.2
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