CONSUMER CONFIDENCE UP IN SEPT.
Byline: Jennifer Owens
WASHINGTON — Consumer confidence advanced for the second consecutive month in September, signaling continued enthusiasm for the nation’s economy, according to figures released Tuesday by the Conference Board.
The Consumer Confidence Index rose a full point in September, to 128.6 from a revised 127.6 in August. September’s preliminary results places the index 1.3 points shy of June’s 28-year high of 129.9. The index has been hovering in the 120s since May.
“With confidence stabilizing at levels not seen in nearly three decades, the economy should continue on a steady upward path,” said Lynn Franco, associate director of the Conference Board’s Consumer Research Center. “The key component to watch is the expectations index, which has been an accurate predictor of future business activity.”
A component of the overall survey, the expectations index measures respondents’ attitudes about the coming six months. It jumped two points in September, to 110.7 from 108.7 points in August. Consumer confidence’s remaining component, however, fell in September: The present situation Index dropped to 155.5 from 156.1 in August.
Franco said, however, that retailers should be pleased by the prospect of high expectations for the next six months, especially when combined with a recent increase in personal income as reported by the Commerce Department this week. According to Commerce figures, personal incomes rose 0.6 percent in August as compared to a 0.2 percent gain in July. Meanwhile, consumer spending increased 0.3 percent in August, following July’s 1 percent rise, which was the biggest jump in six months.
Also, consumers expect their wages to increase even more in the near future, Franco said. She noted that September saw the year’s highest level of respondents expecting future wage increases in the coming six months: 26.8 percent as compared to 25.6 in August and 25 percent a year ago.
Meanwhile, according to the monthly survey of 5,000 households, other measures for the next six months also improved. Of the September respondents, 19.5 percent expect business conditions to be “good,” up from 18.4 percent in August, while 17.4 percent see more jobs coming, up from 16.9 percent.
“With the holiday season around the corner…this could very well translate into an uptick in consumer spending,” Franco said.
“I think we’ll have a little more consumer energy going into the next year.”