The Conference Board’s monthly report on its consumer confidence report showed that the metric utilized to gauge monetary view really bumped up a few points in August. This is the reason the stock exchange went up Tuesday.
Consumer confidence index higher than should be
August reports show consumer confidence levels rising. This was not expected. July the consumer confidence was 51 when in August it went up to 53.5 showing the overall economy may be getting much better rather than staying the same, reports Bloomberg. But besides the increase, an economist told Bloomberg that the August consumer confidence figure is at a “stunningly low level.”. Still, there is a higher confidence. This higher confidence may lead to a recovery of consumer spending, 70 percent of the United States economy. Soon, there may be more hiring. Companies have to do this. The Labor Department shows that only 51,000 jobs were created between May and July. This is down 200,000 from the two months before that.
Consumer Confidence report
In addition to the consumer confidence index, the Conference Board report contains other details. Consumers know the economy is bad right now but hope the future is much better, says MarketWatch. The Conference Board’s present-situation index — a measure of attitudes about business climate and job opportunities — dropped to 24.9 in August from 26.4 in July. The report also shows what the expectations for a better business climate and more jobs creation are, which is called the expectation index. It actually went up from July to August from 67.5 to 72.5. 1.9 percent to 2 percent was how the consumers planning to buy a home moved. People planning to buy a vehicle rose to 5 percent from 4.7 percent. And economist talked to MarketWatch. He explained that despite the fact that there may are an increase in the consumer confidence levels, it is nevertheless at “incredibly depressed levels.”.
Bump in index doesn’t guarantee consumer spending
The Associated Press explains that a healthy economy generally runs under a consumer confidence index over 90. Yet the August bump put the brakes on a sliding stock market Tuesday morning. About two stocks rose for every one that fell on the New York Stock Exchange. This isn’t going to happen for too long. It is too good to be true. The economy is growing slowly, shows most economical reports. There may not be consumer spending just because consumer confidence has gone up. Personal finance shows that it is good that joblessness is moving more people to save and reduce debt. But until the job market recovers and individuals open their wallets, the late-summer slump could continue for the rest of the year and drag the United States of America economy into a double-dip recession.
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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