Survey: Consumer Confidence Continues Climb
Consumer confidence is continuing to rise, posting a 5.4 percent increase in September over August, according to a new survey.
The Survey of Consumers, by Thomson Reuters and the University of Michigan, found that consumer Sentiment Index for September was 78.3, compared to 74.3 in August. That's an increase of 31.6 percent from last year.
The survey said the big year-over-year gain reflected the extreme lows during the debt ceiling debate last year.
Improved confidence was due to consumers' expectations that the economy will create more jobs in the year ahead and was also helped by higher stock prices and rising home values. However, the survey also found that consumers anticipate small wage gains and somewhat higher prices in the year ahead, mostly due to rising food prices.
Half of households anticipate declining living standards as their incomes don't keep pace with inflation.
The survey found that low mortgage rates have accelerated home buying and people are less reluctant to sell their current home to buy another. Although low home prices are a disadvantage to home sellers, the survey said that disadvantage is at its lowest level in the past five years. But recovery in the housing market is expected to be "slow and halting."
As far as the overall economy, twice as many consumers expect it to expand. More consumers reported hearing about job gains and expected them to grow next year. The highest number of those surveyed in the last six months also said they expect declines in unemployment. The Index of Consumer Expectations rose 12.9 percent in September to 73.5. Meanwhile, the Current Conditions Index dropped 3.4 percent to 85.7.
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