Last Update: 28-Oct-14 10:20 ET
- The Conference Board's Consumer Confidence Index jumped to 94.5 in October from an upwardly revised 89.0 (from 86.0) in September. The Briefing.com consensus pegged consumer confidence at 87.2.
- Consumer confidence is now at its strongest point since October 2007 and has finally recovered from the Great Recession.
- Confidence generally trends in conjunction with the equity market, unemployment rate, gasoline prices, and media reports. Large swings in equity prices along with dire media reports about Ebola were expected to contain positive excitement from an improving labor market and lower gasoline costs.
- In the end, consumers paid more adherence to the positive reports amid the volatile data in October.
- The Present Situation Index increased to 93.7 in October from 93.0 in September. The Expectations Index rose from 86.4 in September to 95.0 in October.
- The sharp increase in consumer confidence does not necessarily mean consumption growth will accelerate. Consumption is reliant on income and not confidence. As long as the labor market continues to improve, consumption growth should follow.
- 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