The Consumer Confidence Index from The Conference Board rose for the second month in a row, increasing by 2.9 points to 122.9. The index is constructed so that 1985 equals 100. The index is now at the second-highest level since 2000, behind the 124.9 reading from March 2017.
Both components of the index posted gains for the month. The Present Situation component rose 5.8 points to 151.2, the highest level since 2001. The Expectations component added 1 point to 104 from 103 in the prior month. The Expectations index has been a bit more restrained compared to the present situation index, bouncing around in the 100 to 112 range for the past nine months, following a surge in December after the results of the presidential election in November.
According to the details of the report, the short-term outlook remained relatively stable in August as the percentage of consumers expecting business conditions to improve decreased from 22.4 percent to 19.6 percent. Offsetting the decline in was a drop in the percentage of respondents expecting business conditions to worsen.
Consumers’ current assessment of the labor market was more upbeat though consumers’ outlook for the labor market was mixed. Consumer saying jobs are “plentiful” rose to 35.4 percent, while those claiming jobs are “hard to get” fell to 17.3 percent. The percentage of consumers expecting more jobs in the months ahead dropped to 17.1 percent, while those expecting fewer jobs decreased slightly to 13.0 percent.
Overall, consumer attitudes remain at generally favorable levels, driven by solid gains in income and a tight labor. Expectations for the future are somewhat less rosy but are still at historically positive levels. Both suggest support for future gains in consumer spending and overall economic growth.