The latest Conference Board Consumer Confidence Index was released this morning based on data collected through September 17. The headline number of 103.0 was a slight improvement from the August final reading of 101.3, a downward revision of August's initial 101.5. Today's number was above the Investing.com forecast of 96.1.
Here is an excerpt from the Conference Board press release.
"Consumer confidence increased moderately in September, following August’s sharp rebound," said Lynn Franco, Director of Economic Indicators at The Conference Board. "Consumers' more positive assessment of current conditions fueled this month’s increase, and drove the Present Situation Index to an 8-year high (Sept. 2007, Index=121.2). Consumers' expectations for the short-term outlook, however, remained relatively flat, although there was a modest improvement in income expectations. Thus, while consumers view current economic conditions more favorably, they do not foresee growth accelerating in the months ahead."
Putting the Latest Number in Context
The chart below is another attempt to evaluate the historical context for this index as a coincident indicator of the economy. Toward this end we have highlighted recessions and included GDP. The regression through the index data shows the long-term trend and highlights the extreme volatility of this indicator. Statisticians may assign little significance to a regression through this sort of data. But the slope resembles the regression trend for real GDP shown below, and it is a more revealing gauge of relative confidence than the 1985 level of 100 that the Conference Board cites as a point of reference.
On a percentile basis, the latest reading is at the 66% level of all the the monthly data points since June 1977. That's an increase from 64% previous month.
For an additional perspective on consumer attitudes, see the most recent Reuters/University of Michigan Consumer Sentiment Index. Here is the chart from that post.
And finally, let's take a look at the correlation between consumer confidence and small business sentiment, the latter by way of the National Federation of Independent Business (NFIB) Small Business Optimism Index. As the chart illustrates, the two have tracked one another fairly closely since the onset of the Financial Crisis.
