Consumer confidence over the falls
Kristine Ellis -- Furniture Today, October 28, 2008
New York – The Conference Board has run out of ways to couch the bottomless plunge in its Consumer Confidence Index – simply stating that it “fell to an all-time low in October.”
The Consumer Confidence Index debuted 41 years ago, in 1967. The measure, a monthly survey of 5,000 U.S. households, is indexed at 100=1985, a year chosen because it was neither a peak nor a valley in the survey history. The Index for October stands at 38.0, down from 61.4 in September.
Retailers stand to feel the effects in short order, said Lynn Franco, director of The Conference Board Consumer Research Center. Franco said of the consumers’ mindset: “Their earnings outlook, as well as inflation outlook, is also more pessimistic, and this news does not bode well for retailers who are already bracing for what is shaping up to be a very challenging holiday season.”
Franco noted that the Index was down 23.4 points from September to October, a decline that stands as “the third largest in the history of the series.”
“The Present Situation Index decreased to 41.9 from 61.1 last month. The Expectations Index declined to 35.5 from 61.5 in September,” the survey group reported.
“In assessing current conditions, consumers rated the labor market and business conditions much less favorably, suggesting that the fourth quarter is off to a weaker start than the third quarter. Looking ahead, consumers are extremely pessimistic, and a significantly larger proportion than last month foresees business and labor market conditions worsening,” said Franco.
Every measure worsened, and the Consumer Confidence Index overall fell in all nine geographic regions of the United States.
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