Written by Steven Hansen
The latest Conference Board Consumer Confidence Index’s headline number improved. The Index now stands at 127.3 (1985=100), up from 120.0 (an upward revision) in May. A quote from the Conference Board: “… is currently at its highest level since the onset of the pandemic’s first surge in March 2020“.
Analyst Opinion of Conference Board Consumer Confidence
Consumer confidence had been steady for the previous two years – but the coronavirus killed the upswing. Consumer confidence during the pandemic was as low as seen in 2014 – but now has improved to pre-pandemic levels.
From the Conference Board:
The cutoff date for the preliminary results was June 23.
The consensus range from Econoday was 117.2 to 120.0 (consensus 118.8). This month’s index is based on data collected through ———–
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Per Lynn Franco, Director of Economic Indicators at The Conference Board:
Consumer confidence increased in June and is currently at its highest level since the onset of the pandemic’s first surge in March 2020. Consumers’ assessment of current conditions improved again, suggesting economic growth has strengthened further in Q2. Consumers’ short-term optimism rebounded, buoyed by expectations that business conditions and their own financial prospects will continue improving in the months ahead. While short-term inflation expectations increased, this had little impact on consumers’ confidence or purchasing intentions. In fact, the proportion of consumers planning to purchase homes, automobiles, and major appliances all rose—a sign that consumer spending will continue to support economic growth in the short-term. Vacation intentions also rose, reflecting a continued increase in spending on services.
Caveats Relating to CB Consumer Confidence
From the Conference Board:
The monthly Consumer Confidence Survey®, based on a probability-design random sample, is conducted for The Conference Board by Nielsen, a leading global provider of information and analytics around what consumers buy and watch.
Nielsen Holdings plc (NYSE: NLSN) is a global performance management company that provides a comprehensive understanding of what consumers watch and buy. Nielsen’s Watch segment provides media and advertising clients with Total Audience measurement services for all devices on which content — video, audio and text — is consumed. The Buy segment offers consumer packaged goods manufacturers and retailers the industry’s only global view of retail performance measurement. By integrating information from its Watch and Buy segments and other data sources, Nielsen also provides its clients with analytics that help improve performance. Nielsen, an S&P 500 company, has operations in over 100 countries, covering more than 90 percent of the world’s population. For more information, visit www.nielsen.com.
From Econoday:
The Conference Board compiles a survey of consumer attitudes on the economy. The headline Consumer Confidence Index is based on consumers’ perceptions of current business and employment conditions, as well as their expectations for six months hence regarding business conditions, employment, and income. Three thousand households across the country are surveyed each month. In general, while the level of consumer confidence is associated with consumer spending, the two do not move in tandem each and every month.
Consumer confidence and retail sales generally move in tandem but not necessarily each and every month. Note that consumer assessments of employment conditions are heavily weighted in the consumer confidence index.
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