US Consumer Confidence Rises to 91.7 in October as Views of Business Conditions Improve

The Conference Board’s Consumer Confidence Index rose 7.5 points to 91.7 in October, up from 84.2 in September, the organization reported on Tuesday. The survey period for the preliminary results was October 1 to October 21, with October 21 as the cutoff date.

The Present Situation Index, which tracks views of current business and labor market conditions, rose 8.6 points to 120.4. The Expectations Index, which tracks the short-term outlook for income, business and labor market conditions, rose 6.9 points to 72.6, partly reversing three consecutive monthly declines in that measure.

Views of current business conditions improved: the share of consumers who called conditions good rose to 21.4 percent from 18.8 percent in September, while the share who called them bad fell to 17.8 percent from 20.0 percent. On jobs, 26.7 percent said jobs were plentiful, up from 24.3 percent, while 21.4 percent said jobs were hard to get, unchanged from September.

What improved, and what did not

Fergus McCormick, senior economist for global indicators at The Conference Board, said the recovery lined up with retail gasoline prices easing from September to October. He also said confidence stayed on a long-term downward trend from the past few years, and that consumers planned less spending on services and durable goods over the next six months, a pattern he tied to higher price levels and persistent inflation cutting into purchasing power.

In written responses, consumers kept raising prices, the high cost of food and groceries, and oil and diesel prices. Comments about war and conflict eased for a second straight month but stayed elevated, and mentions of jobs and employment as a concern rose slightly.

Average 12-month inflation expectations fell in October but stayed elevated at 5.8 percent. Consumers still expected higher interest rates over the next 12 months, and more consumers expected stock prices to rise than to fall. Plans to buy cars and homes fell slightly on a six-month moving average basis, and planned spending on durable goods fell across the board, with expected purchases of electronics such as smartphones, computers and tablets pulling back by more than 1 percent.

Vacation plans also dipped: 43.3 percent of consumers planned a vacation in the next six months, down from an upwardly revised 44.2 percent in September. More consumers planned domestic trips, and fewer planned trips to foreign countries.

Other data released Tuesday

Two other reports arrived the same morning, according to Dow Jones Newswires. Orders for durable goods, which are goods meant to last three years or more, rose $6.3 billion to $345.4 billion in September, after a 0.1 percent increase in August. The S and P Cotality Case-Shiller National Home Price Index rose 2.1 percent in the 12 months through August, compared with a 1.9 percent increase in July.

The confidence report arrived on the first day of the Federal Reserve’s two-day meeting, with a rate decision due on Wednesday.

Reporting based on coverage by The Conference Board and Dow Jones Newswires.