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The Conference Board Consumer Confidence Index® fell in September to 103.0 (1985=100), down from 108.7 in August. The Present Situation Index slightly rose to 147.1 (1985=100) from 146.7. However, the Expectations Index declined to 73.7 (1985=100), below the recession threshold of 80.
Consumer Concerns Grow
Consumer fears of a looming recession increased, aligning with a predicted economic contraction in early 2024. Rising prices, especially for groceries and gasoline, along with worries about politics and higher interest rates, contributed to the decline in consumer confidence.
Economist’s Insights
Dana Peterson, Chief Economist at The Conference Board, stated, “Consumer confidence fell again in September 2023, marking two consecutive months of decline.” She highlighted that assessments of the present situation remained relatively unchanged, with mixed views on business conditions and job availability. Concerns about family finances grew.
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Gloomy Short-Term Outlook
Expectations for the next six months worsened, reflecting lower confidence in future business conditions, job availability, and incomes. Rising corporate earnings concerns, narrowing job openings, and increasing interest rates all played a role in this decline.
The proportion of consumers expecting a recession rose in September after a decline in August. Uncertainty persisted, influencing buying plans, with steady auto purchase intentions and rising plans to buy appliances but declining plans to buy homes.
Current Situation
Consumers’ assessment of current business conditions improved slightly. While, 20.9% viewed business conditions as “good,” 16.4% considered them “bad.”
Consumer views on the labor market were slightly more positive, with 40.9% believing jobs were “plentiful” and 13.6% seeing jobs as “hard to get.”
Short-Term Expectations
In terms of short-term expectations, consumers were less optimistic about business conditions and labor markets. Expectations of income growth decreased.
Assessments of current family financial situations and expectations for family financial situations in six months softened in September.
Recession Likelihood
Consumers’ perceived likelihood of a US recession over the next 12 months increased in September.
The Consumer Confidence Survey®, conducted for The Conference Board by Toluna, indicates the mood among consumers. The preliminary results were collected online until September 18.
Disclaimer: Please note that this article serves solely for informational purposes and should not be construed as financial advice. We strongly advise readers to conduct thorough research and consult with financial professionals before making any investment decisions.
