The present situation index—based on consumers’ assessment of current business and labour market conditions—surged to 161.3 in January from 147.2 in the previous month.
The expectations index—based on consumers’ short-term outlook for income, business and labour market conditions—improved to 83.8 in the month from a revised reading of 81.9 in December.
The Conference Board US consumer confidence index rose in January to 114.8 from 108 in December—the third straight monthly rise.
The present situation index surged to 161.3 from December’s 147.2.
The expectations index rose to 83.8 from 81.9 in December.
Consumers were slightly less optimistic about the short-term business conditions outlook in January.
Consumers’ assessment of current business conditions was more positive in January, with 22.5 per cent of consumers saying business conditions were ‘good’, up from 21.1 per cent in December; 14.2 per cent said business conditions were ‘bad’, down from 17.2 per cent earlier.
Consumers’ appraisal of the labour market was also more positive in January, with 45.5 per cent of them saying jobs were ‘plentiful’, up from 40.4 per cent in December; 9.8 per cent of them said jobs were ‘hard to get’, down from 13.1 per cent.
Consumers were, on balance, slightly less optimistic about the short-term business conditions outlook in January, with 16.6 per cent of consumers expecting business conditions to improve, down from 18.7 per cent in December. However, only 16 per cent expect business conditions to worsen, down from 17.8 per cent earlier.
Consumers’ assessment of their short-term income prospects was, on balance, less pessimistic in January, with 16.4 per cent of them expecting their incomes to increase, down from 18.3 per cent in December; 11.5 per cent expect their incomes to decrease, down from 13.6 per cent.
“January’s increase in consumer confidence likely reflected slower inflation, anticipation of lower interest rates ahead, and generally favorable employment conditions as companies continue to hoard labor,” said Dana Peterson, chief economist at the US-based think tank.
“The gain was seen across all age groups, but largest for consumers 55 and over. Likewise, confidence improved for all incomes groups except the very top; only households earning $125,000+ saw a slight dip. January’s write-in responses revealed that consumers remain concerned about rising prices although inflation expectations fell to a three-year low,” she said.
“Buying plans dipped in January, but consumers continued to rate their income and personal finances favorably currently and over the next six months. Consumers’ perceived likelihood of a US recession over the next 12 months continued to gradually ease in January, consistent with an expectations index rising above 80,” she added.
Fibre2Fashion News Desk (DS)
