Consumer confidence, which improved moderately in July, made further gains in August. The index now stands at 56.9, up from 51.9 in July, according to the Conference Board, a New York–based research group.
The index had been on a six–month decline since January.
“Consumer confidence readings suggest that the economy remains stuck in neutral, but may be showing signs of improvement by early next year,” says Lynn Franco, director of the Conference Board Consumer Research Center. “… However, overall readings are still quite low by historical standards and it is still too early to tell if the worst is behind us.”
Despite increases in the past two months, the consumer confidence index is only about half of what it was a year ago at this time.
Consumers’ assessment of current conditions did not improve significantly in August. Those claiming business conditions are “bad” increased to 33.2% from 32.6%, while those claiming business conditions are “good” edged up to 13.4% from 13.2% last month.
Consumers’ appraisal of the labor market has turned bleaker. Those saying jobs are “hard to get” rose to 32% percent from 30.2% in July, while those claiming jobs are “plentiful” declined to 13.1% from 13.6%.
Consumers’ short–term expectations improved again, but still remain negative. Those expecting business conditions to worsen over the next six months declined to 25.8% from 32.4%, while those expecting conditions to improve rose to 11.9% from 9.2%.
The outlook for the labor market also was less pessimistic. The percent of consumers anticipating fewer jobs in the months ahead decreased to 30.6% from 37.3%, while those expecting more jobs increased to 10.5% from 8%. The proportion of consumers anticipating their incomes will increase improved slightly to 14.7% from 14.3%.
The monthly survey is based on a representative sample of 5,000 U.S. households. The consumer confidence index is based on a scale in which 1985=100.