U.S. consumer confidence increases in October

Consumer confidence increased in October to its highest level in almost 17 years as consumers' assessment of present-day conditions improved, according to The Conference Board.

The Conference Board's Consumer Confidence Index® increased to 125.9, up from 120.6 in September. A reading of 90 or higher indicates a healthy economy.

The index measures how shoppers feel about business conditions, the job market and the next six months. Economists watch the index closely because consumer spending accounts for about 70 percent of economic activity and is a crucial part of a strong rebound.

The percentage of consumers saying business conditions are "good" increased from 33.4 percent to 34.5 percent, while those saying business conditions are "bad" rose moderately from 13.2 percent to 13.5 percent. Consumers' assessment of the job market was more positive. Those stating jobs are "plentiful" increased from 32.7 percent to 36.3 percent, and those claiming jobs are "hard to get" decreased from 18 percent to 17.5 percent.

Consumer optimism about the short-term outlook also increased in October. The percentage of consumers expecting business conditions to improve during the next six months increased from 20.9 percent to 22.2 percent, and those expecting business conditions to worsen decreased from 9.6 percent to 6.9 percent.

Consumer outlook for the labor market, however, was less favorable than in September. The proportion expecting more jobs in the months ahead decreased from 19.2 percent to 18.9 percent. However, those anticipating fewer jobs declined from 13 percent to 11.8 percent.

"Consumer confidence increased to its highest level in almost 17 years (December 2000, 128.6) in October after remaining relatively flat in September," says Lynn Franco, director of economic indicators at The Conference Board. "Consumers' assessment of current conditions improved, boosted by the job market, which had not received such favorable ratings since the summer of 2001. Consumers were also considerably more upbeat about the short-term outlook, with the prospect of improving business conditions as the primary driver. Confidence remains high among consumers, and their expectations suggest the economy will continue expanding at a solid pace for the remainder of the year."

Date : 11/3/2017