Tuesday, October 26, 2010

USA Monthly Consumer Confidence Index Up Slightly in October (Chart) "Still hovering at historically low levels"

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USA Economy: "consumers continue to be quite concerned about the short-term outlook"


USA Monthly Consumer Confidence Index Up Slightly in October

Official Statement "The Conference Board Consumer Confidence Index®, which had declined in September, increased slightly in October. The Index now stands at 50.2 (1985=100), up from 48.6 in September. The Present Situation Index increased to 23.9 from 23.3. The Expectations Index improved to 67.8 from 65.5. Says Lynn Franco, Director of The Conference Board Consumer Research Center: “Consumer confidence, while slightly improved from September levels, is still hovering at historically low levels. Consumers’ assessment of the current state of the economy is relatively unchanged, primarily because labor market conditions have yet to significantly improve. And, despite the uptick in Expectations, consumers continue to be quite concerned about the short-term outlook. Both present and future indicators point toward more of the same in the coming months.”

Cycle History The current Consumer Confidence Index (CCI) in October of 50.2 (preliminary) is down -61.7 and -55% from the cyclical peak 111.9 in July 2007. The current CCI is up +24.9 and +98% from the cyclical bottom of 25.3 in February 2009. Therefore, the CCI is much closer to the cyclical low than to the high.

Trend The current trend has been  downwards. The October CCI of 50.2 (preliminary) is below the 12-month moving average of 53.1 and has been for 5 consecutive  months. The  current CCI is above the 24-month moving average of 48.3 and below the 36-month moving average of 54.2.

Chart (Monthly Consumer Confidence Index) Below is a chart of the past 40 months of The Conference Board CCI from the July 2007 cyclical high of 111.9 through the latest month reported, October 2010 (preliminary). As can be seen, the CCI bottomed in February 2009 and the Great Recession officially ended in June 2009. After a peak in May 2009 of 54.8, the CCI has been in a range from a low of 46.4 in February 2010 to a high of 62.7 in May 2010. The current CCI of 50.2 is just above the recent lows of 48.6 in September 2010 and 46.4 in February 2010.



Commentary The September Consumer Confidence Index of  50.2 continues at a low level. and as Lynn Franco, Director of The Conference Board Consumer Research Center stated, "consumers continue to be quite concerned about the short-term outlook". The CCI is closer to the cyclical low of 25.3 in February 2009 than the cyclical high of 111.9 in July 2007, as evidenced by the above chart.This coincides with the Thomson Reuters/University of Michigan's preliminary October reading of 67.9 which was a 3-month low and is reviewed here.

Links
The Conference Board TCB
*Data courtesy of The Conference Board*


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