After a four-month run of improving economic sentiment, consumers experienced a marked dampening of enthusiasm during the month of September, according to the latest report from the Conference Board.
The four month climb had taken the baseline Consumer Confidence Index to 93.4, but it slipped all the way back to 86.0 in September.
Other key metrics also fell, including the Present Situation Index, which went from 93.9 to 89.4; and the Expectations Index, which fell somewhat precipitously from 93.1 to 83.7.
CB’s Lynn Franco stated, “Consumer confidence retreated in September after four consecutive months of improvement. 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.”
There was no significant change in the assessment of current business conditions, but assessment of the job market fell – 15.1% believe jobs are plentiful, down from 17.6% in August.
The short term outlook, meaning expectations for the next six months, took a hit. Those expecting good conditions fell from 20.8% to 18.6%; and those expecting bad conditions rose from 9.9% to 12.6%.
As for wages, the survey produced mixed results. On the plus side, 16.8% expect an increase, better than August’s 15.5%. But those expecting a decrease also rose, from 11.6% to 13.4%.
The survey is put together by the Conference Board with research conducted by Nielsen.
RBR-TVBR observation: The timing of this isn’t particularly encouraging, coming as it does just as retailers are gearing up for the holiday shopping season.
We’ve been hearing pretty good things about holiday shopping, by the way. Nor have we seen any particularly discouraging economic developments lately. Indeed, the US GDP results for Q2 were just adjusted upward.
So maybe this is just a pothole. We’ll be interested to see if October results make this a dip in the rollercoaster or the start of a trend. And we’ll really be interested in seeing a few more holiday spending projections.
And if we see it, so will you.
