Confidence in Economy Rises, Survey Indicates
Consumers’ confidence about the economy increased in December, boosted by low inflation, low unemployment and growth in personal income, a business-financed research organization reported.
The Conference Board’s Consumer Confidence Index increased to 119.8, up nearly 7 points from November, the board said in a report released today. The index had declined in November to 113.1 from October’s figure of 116.9.
Those surveyed were particularly positive about the current economic situation, the board said, with this component of the confidence index the highest since the late 1960s.
The monthly survey of 5,000 U.S. households is conducted for the board by National Family Opinion Inc. of Toledo, Ohio.
“The consumer’s very favorable assessment of prevailing conditions reflects the continued vigor of the economy and bodes well for the immediate future,” said Fabian Linden, executive director of the board’s consumer research center.
“Unemployment is at its lowest level in many years, personal income continues to grow, and the inflation rate is virtually imperceptible to the average shopper,” he said. “All these factors contribute to a high level of confidence.
“Still, there is some uncertainty about the future, with the policies of the new Administration on such major issues as the federal budget and the foreign trade deficits still unknown,” he added.
Buying plans remained at roughly the same level for the past few months, the board said. About 7% of respondents said they plan to purchase a car within six months, 3.5% intend to buy a home in the period and nearly 29% plan to buy a major appliance.