In August, the consumer confidence index metric gauge went up a few bumps for the Conference Board’s monthly report. This is the reason the stock market went up Tuesday.
More of a consumer confidence that expected
August reports show consumer confidence levels increasing. This was not expected. Bloomberg reports that the increase within the consumer confidence report to 53.5 from a five-month low of 51 in July could be a sign the biggest part of the economic system may stay away from a further slide that could effectively end a stalled financial recovery. But even with the increase, an economist told Bloomberg that the August consumer confidence figure is at a “stunningly low level.”. Even so, higher confidence brings a ray of hope that consumer spending — 70 percent of the United States economy — will recover. Corporations should start hiring more soon. Yet according to the Labor Department, companies created an average of 51,000 jobs from May through July — down from 200,000 the previous two months.
Consumer confidence report info
The consumer confidence index wasn’t the only thing the conference Board report gave. There were also lots of other details given. MarketWatch reports that more consumers are pessimistic about the present situation of the economy, yet optimistic that conditions will improve. The present-situation index is the Conference Board’s way of measuring attitudes toward job opportunities and the business climate. It has dropped from 26.4 in July to 24.9 in August. There is also the expectations index showing where the community expects the business climate and job creation to go which went up from 67.5 in July to 72.5 in August. 1.9 percent to 2 percent was how the consumers preparing to buy a home moved. People planning to purchase a vehicle rose to 5 percent from 4.7 percent. An economist told MarketWatch that despite the August gains, consumer confidence is at “incredibly depressed levels,” in contrast to previous financial recoveries.
Increase in index doesn’t mean consumer spending
To know your economic system is healthy, you should have a consumer confidence over 90. This was explained by the Associated Press. Tuesday morning, there was still a change in the stock exchange because of the August bump. About two stocks rose for each one that fell on the New York Stock Exchange. This likely will not last for long. Most economic reports show economic growth is slowing, and the slight uptick in consumer confidence doesn’t guarantee a rise in consumer spending. Personal finance shows that it is good that unemployment is moving more people to conserve and reduce debt. The United States of America overall economy might end up in a double-dip recession if more people do not get jobs and start spending again.
Bloomberg
bloomberg.com/news/2010-08-31/consumer-confidence-in-u-s-rose-more-than-economists-forecast-in-august.html
MarketWatch
marketwatch.com/story/august-consumer-confidence-rises-to-535-2010-08-31-102600
Associated Press
google.com/hostednews/ap/article/ALeqM5jmT59dgLTTziX4p9X9MRBRpWZGdQD9HUH2I80
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