Last Update: 30-Sep-14 10:18 ET
- The Conference Board’s Consumer Confidence Index dropped to 86.0 in September from an upwardly revised 93.4 (from 92.4) in August. The Briefing.com consensus expected the index to fall to 92.0.
- This was the lowest reading in the Consumer Confidence Index since May.
- The University of Michigan consumer sentiment level increased in September following historically high equity prices, downward trending gasoline costs, and improvements in labor market conditions. Those same underlying conditions played no role in the consumer confidence index.
- Instead, concerns over geopolitical problems in Russia and Iraq helped drive the Conference Board’s Expectations Index down to 83.7 in September from 93.1 in August. That was the largest one-month decline since falling 12.5 points in October 2013.
- The Present Conditions Index fell to 89.4 in September from 93.9 in September.
- The drop in consumer confidence is unlikely to have much of an impact on consumption growth. Spending relies upon income gains. As long as labor market conditions continue to improve, consumer spending should follow suit.
- Income gains are the main catalyst for spending, yet rising levels of confidence over time tend to help on the margin.
|Employment ('plentiful' less 'hard to get')
|1 yr inflation expectations