Consumer Confidence Shows Unexpected Deterioration In September

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Consumer confidence unexpectedly decreased in the month of September, according to a report released by the Conference Board on Tuesday, although the consumer confidence index remains well off the lows set earlier this year.

The Conference Board said its consumer confidence index slipped to 53.1 in September from a revised 54.5 in August. Economists had been expecting the index to increase to 57.0 from the 54.1 originally reported for the previous month.

Despite the unexpected decrease, the index remains well off the low of 25.3 set in February of 2009. However, Peter Boockvar, equity strategist for Miller Tabak, noted that the move off the lows was almost all due to an improvement in expectations.

A notable deterioration in the assessment of current conditions contributed to the unexpected decrease in September, with the present situation index falling to 22.7 from 25.4 in August.

The report showed that those claiming current business conditions are "bad" rose to 46.3 percent in September from 44.6 percent in August, although those claiming conditions are "good" also edged up to 8.7 percent from 8.5 percent.

With regard to the labor market, those claiming jobs are "hard to get" increased to 47.0 percent in September from 44.3 percent in August and those claiming jobs are "plentiful" fell to 3.4 percent from 4.3 percent.

The Conference Board said consumers' short-term outlook was also slightly more pessimistic, with the expectations index edging down to 73.3 in September from 73.8 in the previous month.

Consumers expecting business conditions to improve over the next six months fell to 21.3 percent in September from 22.2 percent in August, while those expecting conditions to worsen decreased to 15.0 percent from 15.2 percent.

At the same time, the outlook for the labor market was nearly unchanged, with those expecting more jobs in the months ahead edging down to 17.9 percent in September from 18.0 percent in August and those expecting fewer jobs unchanged at 23.1 percent.

Those expecting an increase in their incomes increased slightly to 11.2 percent in September from 10.8 percent in August.

Lynn Franco, Director of the Conference Board Consumer Research Center said, "While not as pessimistic as earlier this year, consumers remain quite apprehensive about the short-term outlook and their incomes."

"With the holiday season quickly approaching, this is not very encouraging news," Franco added.

Consumer confidence unexpectedly decreased in the month of September, according to a report released by the Conference Board on Tuesday, although the consumer confidence index remains well off the lows set earlier this year. The Conference Board said its consumer confidence index slipped to 53.1 in September from a revised 54.5 in August. Economists had been expecting the index to increase to 57.0 from the 54.1 originally reported for the previous month. (Market News Provided by RTTNews)