After three declining months, U.S. consumers felt better in Oct. about both the current and future economy, with the confidence index rising 4 points to 113.8.
By Kerry Smith
BOSTON – After three months of declines, the Conference Board Consumer Confidence Index increased in October to 113.8, up from 109.8 the month before.
The Present Situation Index – consumers’ assessment of current business and labor market conditions – rose to 147.4 from 144.3 last month. The Expectations Index – consumers’ short-term future expectations for income, business and labor market conditions – improved to 91.3 from 86.7.
“Consumer confidence improved in October … as concerns about the spread of the delta variant eased,” says Lynn Franco, senior director of economic indicators at The Conference Board.
“While short-term inflation concerns rose to a 13-year high, the impact on confidence was muted,” Franco says. “The proportion of consumers planning to purchase homes, automobiles, and major appliances all increased in October – a sign that consumer spending will continue to support economic growth through the final months of 2021. Likewise, nearly half of respondents (47.6%) said they intend to take a vacation within the next six months – the highest level since February 2020, a reflection of the ongoing resurgence in consumers’ willingness to travel and spend on in-person services.”
- Consumers’ appraisal of current business conditions was mixed in October: 18.6% said business conditions are “good,” down from 19.1%. On the flipside, 24.9% of consumers said business conditions are “bad,” down from 25.3%.
- Consumers’ assessment of the labor market was moderately more favorable: 55.6% said jobs are “plentiful,” down from 56.5%. Conversely, 10.6% said jobs are “hard to get,” down from 13.0%.
Expectations six months from now
- Consumers’ optimism about short-term business conditions was mixed in October: 24.3% expect business conditions to improve, up from 21.7%. But on the other hand, 21.1% expect business conditions to worsen, up from 17.6%.
- Consumers were more optimistic about the short-term labor market outlook: 25.4% expect more jobs to be available in the months ahead, up from 21.3%; 18.3% anticipate fewer jobs, down from 19.9%.
- Consumers were also more positive about their short-term financial prospects: 18.7% expect their incomes to increase, up from 16.9%, and 11.3% expect their incomes to decrease, virtually unchanged from 11.4% the month before.
Toluna conducts the monthly Consumer Confidence Survey. The cutoff date for the preliminary results was October 20.
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