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US Consumer Confidence recovers in October

Nov 22, 2024 United States

October marked broad improvements in consumer sentiment across age and income groups, with expectations for economic growth exceeding thresholds that typically signal recession concerns

"Consumer confidence recorded the strongest monthly gain since March 2021 but still did not break free of the narrow range that has prevailed over the past two years. Compared to last month [September 2024], consumers were substantially more optimistic about the future business conditions and remained positive about future income", commented Dana M. Peterson, Chief Economist at The Conference Board.

In October 2024, the Conference Board Consumer Confidence Index rose to 108.7, up from 99.2 in September, reflecting optimism about current economic and labour market conditions. The Present Situation Index, which measures consumers' perceptions, increased to 138.0. Meanwhile, the Expectations Index, which captures short-term outlook, grew to 89.1, above the threshold (80) that typically signals concerns of a recession.

Peterson added: "October's increase in confidence was broad-based across all age groups and most income groups. In terms of age, confidence rose sharpest for consumers aged 35 to 54. On a six-month moving average basis, households aged under 35 and those earning over a hundred thousand US dollars remained the most confident".

Despite the improved economic outlook, consumers' assessments of their current financial situations remain unchanged. However, their optimism for the coming six months reached record levels. The share of consumers expecting a recession within the next year decreased to its lowest since the metric was introduced in 2022, suggesting a positive sentiment about the economy's trajectory, with consumers expressing greater confidence in future stability and growth.

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