Consumer confidence drops in September

Consumer confidence fell from its recent high of 93.4 in August to 86.0 in September, breaking a string of four consecutive monthly gains.

“Consumer confidence retreated in September after four consecutive months of improvement," said Lynn Franco, director of economic indicators at The Conference Board. "A less positive assessment of the current job market, most likely due to the recent softening in growth, was the sole reason for the decline in consumers’ assessment of present-day conditions. Looking ahead, consumers were less confident about the short-term outlook for the economy and labor market, and somewhat mixed regarding their future earnings potential. All told, consumers expect economic growth to ease in the months ahead.”

The Present Situation Index also decreased to 89.4 from 93.9. However, there was little change in the current view of business conditions -- the drop is attributable to the appraisal of the job market, with those claiming jobs are "plentiful" falling from 17.6% to 15.1%.

The Expectations Index dropped to 83.7 from 93.1, with a noticeable decrease in those expecting business conditions to improve over the next six months (down from 20.8% to 18.6%). Those expecting them to worsen rose from 9.9% to 12.0%. Similar patterns emerged among those expecting fewer jobs in the months ahead. There was an increase both in those expecting a raise and a drop in their incomes.