Consumer confidence bounces back

Marianne Wilson
Editor-in-Chief
Consumer confidence improved  sharply in August.
U.S. consumer confidence edged up in November.

U.S. consumers turned less gloomy in November as the holiday shopping season officially kicked off.

The Conference Board’s Consumer Confidence Index edged up to 102.0 in preliminary results for November from a downwardly revised 99.1 in October. The increase followed three straight monthly declines. 

The Expectations Index — based on consumers’ short-term outlook for income, business, and labor market conditions — rose to 77.8 in November, up from its downwardly revised reading of 72.7 in October. The Present Situation Index — based on consumers’ assessment of current business and labor market conditions — ticked down slightly to 138.2  from 138.6. 

In other findings, consumers’ perceived likelihood of a U.S. recession during the next 12 months abated in November to the lowest levels seen this year. But about two-thirds of consumers surveyed in November still perceive a recession during that time to be “somewhat” or “very likely.”

November’s increase in consumer confidence was concentrated primarily among householders aged 55 and up. By contrast, confidence among householders aged 35-54 declined slightly. General improvements were seen across the spectrum of income groups surveyed in November. 

At the same time, write-in responses revealed consumers remain preoccupied with rising prices in general, followed by war/conflicts and higher interest rates, according to Dana Peterson, chief economist at The Conference Board. 

“Consumer expectations for the next six months recovered in November, reflecting improved confidence about future business conditions, job availability, and incomes, “Peterson added. “Compared to last month, expectations that interest rates will rise in the year ahead ticked down, but consumers’ outlook for stock prices continued to weaken in November.  Buying plans for autos, homes, and big-ticket appliances trended downward on a six-month basis—perhaps reflecting the impact of elevated interest rates.”

In other findings,  average 12-month inflation expectations receded back to 5.7% after a one-month uptick to 5.9%. And consumers’ perceived likelihood of a U.S. recession during the next 12 months abated in November to the lowest levels seen this year. But about two-thirds of consumers surveyed in November still perceive a recession during that time to be “somewhat” or “very likely.”

Here are other findings from the November report:

Present Situation

Consumers’ assessment of current business conditions was, on balance, slightly more positive in November.

•19.8% of consumers said business conditions were “good,” up from 18.3% in October.

•However, 19.5% said business conditions were “bad,” up from 18.8%.

Consumers’ appraisal of the labor market was mixed in November.

•39.3% of consumers said jobs were “plentiful,” up slightly from 37.9% in October.

•However, 15.4% of consumers said jobs were “hard to get,” up from 14.1%.

Expectations Six Months Hence

Consumers were less pessimistic about the short-term business conditions outlook in November.

•17.3% of consumers expect business conditions to improve, up from 15.5% in October.

•19.5% expect business conditions to worsen, down from 20.9%.

Consumers’ assessment of the short-term labor market outlook was slightly more optimistic in November.

•16.1% of consumers expect more jobs to be available, up from 15.3% in October.

•19.6% anticipate fewer jobs, down slightly from 19.7%.

Consumers’ assessment of their short-term income prospects improved in November.

•17.2% of consumers expect their incomes to increase, up from 15.6% in October.

•12.1% expect their incomes to decrease, down from 13.4%.

The monthly Consumer Confidence Survey, based on an online sample, is conducted for The Conference Board by Toluna, a technology company that delivers real-time consumer insights and market research through its innovative technology, expertise, and panel of over 36 million consumers. The cutoff date for the November preliminary results was November 15. 

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