A report released by the Conference Board on Tuesday showed a continued increase in U.S. consumer confidence in the month of October.
The Conference Board said its consumer confidence index rose to 137.9 in October from a downwardly revised 135.3 in September.
Economists had expected the consumer confidence index to drop to 136.3 from the 138.4 originally reported for the previous month.
With the increase, the consumer confidence index reached its highest level since hitting 142.5 in September of 2000.
The report said the present situation index climbed to 172.8 in October from 169.4 in September, reflecting an improvement in consumers’ assessment of current conditions.
The percentage of consumers saying business conditions are “good” inched up to 40.5 percent from 39.9 percent, while those claiming conditions are “bad” edged down to 9.2 percent from 9.6 percent.
Consumers’ assessment of the labor market was also more favorable, with those claiming jobs are “plentiful” rising to 45.9 percent from 44.1 percent and those claiming jobs are “hard to get” dipping to 13.2 percent from 14.1 percent.
Reflecting a continued increase in optimism about the short-term future, the expectations index also rose to 144.6 in October from 112.5 in September.
The percentage of consumers expecting business conditions will improve over the next six months crept up to 26.3 percent from 25.8 percent, while those expecting conditions will worsen dipped to 7.4 percent from 8.3 percent.
Meanwhile, the Conference Board said the outlook for the labor market was somewhat mixed, as consumers expecting more jobs in the months ahead edged down to 21.9 percent from 22.1 percent but those anticipating fewer jobs also slipped to 10.5 percent from 11.4 percent.
The University of Michigan released a separate report last Friday showing consumer sentiment in the U.S. deteriorated by slightly more than initially estimated in the month of October.
The report said the consumer sentiment index for October was downwardly revised to 98.6 from the preliminary reading of 99.0.
Economists had expected the consumer sentiment index to be unrevised at 99.0, which was still down from 100.1 in September.
Why Markets Care About Conference Board Consumer Confidence Index (CCI)
The Conference Board (CB) publishes the Consumer Confidence Index (CCI), at 10 a.m. ET on the last Tuesday of every month.
It measures Level of a composite index based on surveyed household.
The usual effect is that ‘Actual’ greater than ‘Forecast’ is good for the dollar and vice versa.
The Consumer Confidence Index is derived a survey of about 5,000 households which asks respondents to rate the relative level of current and future economic conditions including labor availability, business conditions, and overall economic situation. The Consumer Confidence Survey reflects prevailing business conditions and likely developments for the months ahead. This monthly report details consumer attitudes and buying intentions, with data available by age, income, and region.
The Conference Board Consumer Confidence Index (CCI) is a barometer of the health of the U.S. economy from the perspective of the consumer. The index is based on consumers’ perceptions of current business and employment conditions, as well as their expectations for six months hence regarding business conditions, employment, and income. The Consumer Confidence Index and its related series are among the earliest sets of economic indicators available each month and are closely watched as leading indicators for the U.S. economy.
Financial confidence is a leading indicator of consumer spending, which accounts for a majority of overall economic activity.