The Conference Board Consumer Confidence Index in September slipped to 103, down from an upwardly revised 108.7 in August.
However, the Present Situation index gained as the Expectation Index declined, according to the Conference Board.
The Present Situation Index, based on consumers’ assessment of current business and labor market conditions, rose slightly to 147.1 from 146.7 a month earlier. In Conference Board index assessments, 100 is the dividing line between positive and negative assessment of business conditions, The Expectations Index, based on consumers’ short-term outlook for income, business and labor market conditions, declined to 73.7 after falling to 83.3 in August. Expectations fell back below 80, the level that historically signals a recession within the next year but at which state the Expectation Index has been for much of the past year. Consumer worries about an impending recession also ticked back up.
Regarding the Present Situation index, 20.9% of consumers responding to a Conference Board survey said business conditions were good, down from 21.5% in August; 16.4% said they were bad, down from 17.3%. At the same time, 40.9% of consumers said jobs were plentiful, up from 39.9% in August; 13.6% of consumers said jobs were hard to get, up from 13.2%.
In terms of the Expectation, looking out six months, 14.1% of consumers said they expect business conditions to improve, down from 17.5% in August; 18.4% expect business conditions to worsen, up from 17.3%. Then, 15.5% of consumers expect more jobs to be available, down from 17.5% in August; 18.9% anticipate fewer jobs, up from 18%.
Consumer anticipation about their income prospects six months out was more pessimistic in September. Consumers’ assessment of income prospects declined, with 16.3% of consumers expecting their incomes to increase, down from 18.7% in August, and 14.4% expecting their incomes to decline, up from 11.9%. Consumer expectation of a recession increased by a little more than a point from 68% in August.
“Consumer confidence fell again in September 2023, marking two consecutive months of decline,” said Dana Peterson, Conference Board chief economist. “September’s disappointing headline number reflected another decline in the Expectations Index, as the Present Situation Index was little changed. Write-in responses showed that consumers continued to be preoccupied with rising prices in general, and for groceries and gasoline in particular. Consumers also expressed concerns about the political situation and higher interest rates. The decline in consumer confidence was evident across all age groups, and notably among consumers with household incomes of $50,000 or more.”
