Those looking for a bright spot following a cascade of bad inflation news and recession predictions can find it in the latest Consumer Confidence Index released this week. The Conference Board, a member-driven think tank, reported that consumer confidence rose in August, stemming a three-month period of declines.
Consumers’ more positive – or at least less negative – take on current market conditions is also reflected in a higher Consumer Expectations Index. That index is based on people’s short-term outlook for income, business and labor market conditions.
The Conference Board’s research shows that 19.2% of consumers think that business conditions are good, up from 16.3% last month. Looking ahead, 17.5% expect business conditions to improve six months from now, up from 13.7% in July. On the flip side, 22.3% think that conditions will deteriorate, lower than the 26.2% rate last month.
“Purchasing intentions increased after a July pullback, and vacation intentions reached an eight-month high. Looking ahead, August’s improvement in confidence may help support spending, but inflation and additional rate hikes still pose risks to economic growth in the short term,” said Lynn Franco, senior director of economic indicators at The Conference Board, which is based in New York.
To Franco’s point, there are still some significant headwinds in the overall economy. “Concerns about inflation continued their retreat but remained elevated,” she noted.
Labor challenges also remain top of mind, if a bit mixed. Nearly half – 48% – of consumers reported that jobs were plentiful, down from 49.2% in July. At the same time, 11.4% said that jobs were hard to get, down from the previous 12.4% mark.
The monthly Consumer Confidence Survey is conducted online for The Conference Board by Norwalk, Conn.-based tech company Toluna.