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Consumer Confidence Index declines nearly 5 points

NEW YORK - The Consumer Confidence Index fell nearly five points to 60.6 in August to its lowest level in nine months, according to The Conference Board's monthly survey.
     The Index had been at 65.4 in July (1985=100), up 2.7 points from June.
     Declining hopes for the future were behind the August drop. The Expectations Index decreased to 70.5 from 78.4, while the Present Situation Index was virtually unchanged, at 45.8 versus 45.9 a month ago.
     "The Consumer Confidence Index is now at its lowest level since late last year (November 2011, 55.2)," said Lynn Franco, director of economic indicators at The Conference Board. "A more pessimistic outlook was the primary reason for this month's decline in confidence. Consumers were more apprehensive about business and employment prospects, but more optimistic about their financial prospects despite rising inflation expectations. Consumers' assessment of current conditions was virtually unchanged, suggesting no significant pickup or deterioration in the pace of growth."
     The survey, done for The Conference Board by Nielsen, had a cutoff date of Aug. 16 for preliminary results.
     Looking at the current climate, consumers claiming business conditions are "good" improved to 15.2% from 13.7%, while those saying business conditions are "bad" was unchanged at 34.4%.
     Consumers' appraisals of the labor market varied. Those stating jobs are "plentiful" declined to 7% from 7.8%, while those claiming jobs are "hard to get" edged down to 40.7% from 41%.
     Consumers' optimism about the short-term outlook deteriorated in August. The percentage of consumers expecting business conditions to improve over the next six months declined to 16.5% from 19%, while those anticipating business conditions will worsen increased to 17.7% from 15.1%.
     Consumers' outlook for the labor market was also less favorable. Those expecting more jobs in the months ahead decreased to 15.4% from 17.6%, while those anticipating fewer jobs rose to 23.4% from 20.6%. The proportion of consumers expecting an increase in their incomes, however, improved to 15.7% from 14.2%.

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