The Conference Board Consumer Confidence Index® Declines Again
27 Jul. 2010
The Conference Board Consumer Confidence Index® which had declined sharply in June, retreated further in July. The Index now stands at 50.4 (1985=100), down from 54.3 in June. The Present Situation Index decreased to 26.1 from 26.8. The Expectations Index declined to 66.6 from 72.7 last month.
The Consumer Confidence Survey® is based on a representative sample of 5,000 U.S. households. The monthly survey is conducted for The Conference Board by TNS. TNS is the world’s largest custom research company. The cutoff date for July’s preliminary results was July 21st.
Says Lynn Franco, Director of The Conference Board Consumer Research Center: “Consumer confidence faded further in July as consumers continue to grow increasingly more pessimistic about the short-term outlook. Concerns about business conditions and the labor market are casting a dark cloud over consumers that is not likely to lift until the job market improves. Given consumers’ heightened level of anxiety, along with their pessimistic income outlook and lackluster job growth, retailers are very likely to face a challenging back-to-school season.”
Consumers’ assessment of current conditions was more downbeat in July. Those saying conditions are “bad” increased to 43.6 percent from 41.0 percent, however, those saying business conditions are “good” increased to 9.0 percent from 8.4 percent. Consumers’ appraisal of the job market was also more negative. Those claiming jobs are “hard to get” increased to 45.8 percent from 43.5 percent, while those saying jobs are “plentiful” remained unchanged at 4.3 percent.
Consumers’ short-term outlook also deteriorated further in July. The percentage of consumers expecting an improvement in business conditions over the next six months decreased to 15.9 percent from 17.1 percent, while those anticipating conditions will worsen rose to 15.7 percent from 13.9 percent.
Consumers were also more pessimistic about future job prospects. Those expecting more jobs in the months ahead decreased to 14.3 percent from 16.2 percent, while those anticipating fewer jobs increased to 21.1 percent from 20.1 percent. The proportion of consumers expecting an increase in their incomes declined to 10.0 percent from 10.6 percent.
Grandpa: given the fact that the U.S. Equity market remains disconnected from the consumer, this poor reading will likely provide the fuel necessary for the Dow Jone Industiral Average (DJIA) to launch 100+ points for the 4th consecutive day...producing a new world record for the DJIA! Yippee....publically traded companies fire hundreds of thousands of employees and report profits beating expectations. Yippee!! What a great environment for the Wall Street gamers.
Do not fret America as Timmy "the weasel" Geithner has your back: "Right now, the best thing the government can do ... is help create the conditions for the private sector to start to invest in hiring again," he said. "Now, we've seen six months of positive job growth by the private sector. That's pretty good," Geithner said. "Pretty good this early in a recession."