U.S. Consumer Confidence Declines in September

The Conference Board's Index of Consumer Confidence weakened 5.2% during September (-4.5% y/y) to 103.0 after declining 4.6% during August to 108.7, revised from 106.1. It was the lowest level of confidence in four months. A reading of 105.6 for September had been expected in the Action Economics Forecast Survey.

The Expectations Index declined 11.5% (-7.3% y/y) to 73.7 after falling 5.3% in August. It rose 10.0% in July. The index remained up from a most recent low of 70.4 in February. The Present Situations Index improved 0.3% (-2.1% y/y) to 147.1 after falling 4.1% in August. It reached a high of 155.3 in June.

Twenty-one percent of respondents characterized current business conditions as good in September, down from 21.5% in August and off a high of 23.4% in June. These figures are still above their low of 16.3% in July of 2022. Labor market readings were little changed this month. The jobs gap, representing the difference between respondents indicating that jobs are plentiful versus those saying jobs are hard to get, rose to 27.3% from 26.7% in August. Both were below the March 2022 high of 47.1. Calculated by Haver Analytics, this series has a 64% correlation with the unemployment rate over the last ten years. The jobs plentiful measure rose to 40.9% from 39.9% and remained down from the March 2022 high of 56.7%. The jobs hard to get measure of 13.6% compared to 13.2% in August. It remained near the highest level in two years. The jobs not-so-plentiful reading of 45.5% was down modestly m/m but increased from a 30.5% low in September 2021.

Consumers assessment of future business conditions deteriorated as a lessened 14.1% felt that conditions would get better in six months. That was down from 17.5% in August and a high of 20.9% in December. A reduced 15.5% of respondents felt there would be more jobs in six months, down from 20.0% in December. A lessened 16.3% expected income to increase in six months, down from 18.7% in August and a high of 19.6% in October of last year.

The expected inflation rate in twelve months of 5.7% held steady with August. It remained below the 7.9% high in June of last year, but it was above the 4.4% low in January 2020.

A notably lessened 58.2% of respondents felt that interest rates would be higher in twelve months, compared to 63.5% In August, while a fairly steady 12.2% thought they would be lower. Thirty-one percent of respondents thought that stock prices would be higher in twelve months, compared to 33.9% in August. That remained up, however, from 26.6% twelve months ago. A slightly higher 33.1% thought stock prices would be lower in twelve months versus a high of 44.7% in July of last year.

The share of respondents planning to buy a home within six months fell to 4.9%. from 6.1% in August. It was the same as one year earlier, but below the October 2022 high of 7.4%. The percentage of respondents planning to buy a major appliance fell to 46.2% and has fallen from a high of 52.4% in October 2022.

The Consumer Confidence data are available in Haver's CBDB database. The total indexes, which are indexed to 1985=100, appear in USECON, and market expectations are in AS1REPNA.