Confidence rises further in September

Consumer confidence's September progress topped off the sharp uptick that happened in August, now standing at 103.0 (compared to 101.3 last month).

The increase was largely attributed to a more favorable view of current conditions, with the Present Situation Index increasing from 115.8 to 121.1. The Expectations Index actually edged down from 91.6 to 91.0.

“Consumer confidence increased moderately in September, following August’s sharp rebound,” said Lynn Franco, director of economic indicators at The Conference Board. “Consumers’ more positive assessment of current conditions fueled this month’s increase, and drove the Present Situation Index to an 8-year high (Sept. 2007, Index=121.2). Consumers’ expectations for the short-term outlook, however, remained relatively flat, although there was a modest improvement in income expectations. Thus, while consumers view current economic conditions more favorably, they do not foresee growth accelerating in the months ahead.”

There was major progress in the proportion of consumers saying business conditions are “good" (from 23.7% to 28.0%). Those claiming business conditions are “bad” declined modestly from 17.8% to 16.7%.

The trend was clear concerning the state of the current job market. Those stating jobs are “plentiful” increased from 22.1% to 25.1%, however those claiming jobs are “hard to get” also rose from 21.7% to 24.3%.

The percentage of consumers expecting business conditions to improve over the next six months increased from 16.6% to 17.9%, but those expecting business conditions to worsen also increased, from 9.1% to 10.3%.

The view on the near-term labor market was also mixed. Those anticipating more jobs in the months ahead was virtually unchanged at 15.0%, while those anticipating fewer jobs increased from 14.5% to 15.8%. The proportion of consumers expecting their incomes to increase improved from 16.2% to 19.1%, while the proportion expecting a decline inched up from 9.8% to 10.1%.