November consumer confidence at 7-month low, USA
November consumer confidence in the United States stands at 70.4 (1985=100), lower than October’s 72.4, according to the Conference Board “Consumer Confidence Index®”. Consumer confidence is now at a 7-month low.
November’s Expectations Index fell to 69.3 compared to 72.2 in October, while the Present Situation Index dropped to 72 (from October’s 72.6).
Lynn Franco, Director of Economic Indicators at The Conference Board said:
“Consumer confidence declined moderately in November after sharply declining in October. Sentiment regarding current conditions was mixed, with consumers saying the job market had strengthened, while economic conditions had slowed. However, these sentiments did not carry over into the short-term outlook.”
”When looking ahead six months, consumers expressed greater concern about future job and earning prospects, but remain neutral about economic conditions. All in all, with such uncertainty prevailing, this could be a challenging holiday season for retailers.”
According to the Conference Board, consumers see overall current conditions as slightly more negative now compared to October.
Business conditions – consumers reporting “good” business conditions rose from 19.5% in October to 19.9% in November, while those claiming conditions are bad increased more sharply from 23% to 25.2%.
The job market – consumers’ assessment of the job market improved slightly. 11.8% of respondents say jobs are “plentiful”, compared to 11.6% in October, while 34% see jobs as “hard to get”, compared to 34.9% in October.
November consumer confidence fell after October’s sharp decline
Consumers’ expectations fell sharply in October, and then some more in November. Below are some highlighted data from the Conference Board:
- Business conditions – 16.6% expect business conditions will get better over the next six months, compared to 16% in October.
- Business conditions – 16.8% expect business conditions to get worse, compared to 17.5% in October.
- Jobs – just 12.7% expect the job market to improve over the next six months, compared to 16% in October.
- Jobs – 21.7% expect the job market to deteriorate, compared to 22.6% in October.
- Incomes – 14.9% think their incomes will improve over the next six months, compared to 15.7% in October.
- Incomes – 15.9% believe their incomes will fall, compared to 15.5% in October.
November consumer confidence influenced by government shutdown
During the first two weeks of October the US Government was partially shutdown, the 18th shutdown in the past forty years.
Members of Congress squabbled over raising the national debt ceiling until the eleventh hour. According to the Wall Street Journal, it was the 80th time they have done so since 1960.
The partial government shutdown was eventually called off when the Democrats and Republicans agreed on a short-term arrangement which would keep government funding going until January 15th, 2014. The debt limit deadline was postponed until February 7th, 2014.
Consumers are also concerned about other discouraging news in the US economy, such as unemployment, which has stayed higher than 7% for the last five years.