The Conference Board is out with its monthly reading of consumer confidence in the month of July. It posted its third consecutive gain, but perhaps the real news is that this is its highest level going back to October 2007.
Confidence was given an index reading of 90.9. This reading was only 86.4 in the month of June.
The Conference Board also signaled that the Present Situation Index rose to 88.3 from 86.3. What really drove the report higher was the Expectations Index, rising to 92.7 from 86.4 in June. This signals that consumers feel good about today but they feel drastically better regarding their expectations for the month ahead.
Also note that the cutoff date for the preliminary results was July 17. Strong job growth was one driver of the mood, and short-term outlooks for the economy and jobs helped to drive expectations higher. The Conference Board's message is simple here in its outlook: the recent strengthening in growth is likely to continue into the second half of this year.
Other parts of the report are as follows, for consumer surveys comparing July versus June:
- Those claiming business conditions are "good" edged down to 22.7% from 23.4%.
- Those claiming business conditions are "bad" was virtually unchanged at 22.7%.
- Those saying jobs are "plentiful" increased to 15.9% from 14.6%.
- Those claiming jobs are "hard to get" remained unchanged at 30.7%.
- Those expecting business conditions to improve over the next six months rose to 20.2% from 18.4%.
- Those expecting business conditions to worsen was flat at 11.5%.
- Those expecting more jobs in the months ahead rose to 19.1% from 16.3%.
- Those expecting fewer jobs fell to 16.4% from 18.4%.
- Those expecting their incomes to grow rose to 17.3% from 16.7%.
- Those expecting their incomes to drop fell to 11.0% from 11.4%.
This is just one of those reports where 90% or so of the underlying data was better than expected. It bodes well for the second half, and we value this report's breadth much more than confidence and sentiment from the University of Michigan's.
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Filed under: Economy