As chart chart below highlights, consumer confidence has been in a narrow range for over a year, with no signs of breaking out to the upside.
Worse, the Present Situation Index, which as its name implies, measures current attitudes on the economy, continues to scrape the bottom. It fell from 24.9 to 23.1.
(click to enlarge)
Future expectations, which has rebounded off the recession low, fell to 65.4 from 72.0.
Taken together, consumers have little good to say about current conditions, while expressing very guarded optimism about the future.
Just the facts – taken from the Conference Board’s survey
Digging into the release, those saying business conditions are “bad” increased to 46.1 percent from 42.3 percent, while those claiming business conditions are “good” declined to 8.1 percent from 8.4 percent.
Those claiming jobs are “hard to get” rose to 46.1 percent from 45.5 percent, while those stating jobs are “plentiful” decreased to 3.8 percent from 4.0 percent.
Consumers are also more pessimistic about future employment prospects.
Those expecting more jobs in the months ahead remained essentially unchanged at 14.5 percent in September, compared to 14.7 percent in August. However, those anticipating fewer jobs increased to 22.7 percent from 19.6 percent. The proportion of consumers expecting an increase in their incomes declined slightly to 10.2 percent from 10.6 percent.
This means…
The glum mood detected in the survey and also reflected in the University of Michigan’s survey has not caused consumer spending or retail sales to falter.
What it is likely doing is putting a cap on growth and suggesting further gains in economic output will be slow in coming.
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