Consumer Confidence Holds Steady

Don Hogsett, Powell Slaughter, July 31, 2006

Consumers' spirits perked up modestly for a second straight month during July, rising by 1.0% to a level of 106.5 and coming back from an April slide, The Conference Board reported.

Consumers are still feeling good about current conditions, but their expectations are subdued looking six months out, said the business think tank, following its monthly canvass of 5,000 Americans nationwide.

“Consumer confidence continues to hold steady,” said Lynn Franco, director of The Conference Board's Consumer Research Center. “Present-day conditions remain favorable, though not as strong as earlier this year. Expectations for the months ahead remain cautious and also below levels earlier this year.”

Weighing in on current conditions, consumers claiming conditions are good rose to 27.6% from 26.6% in June. But those who claim conditions are bad also increased, up to 15.5% from 15.0%. The six-month outlook improved modestly, with the number expecting conditions to worsen declining to 11.1% from 11.9%. But the number who think conditions will improve fell also, to 16.4% from 16.8%.

The current jobs outlook was little changed. The number who said jobs are plentiful increased to 28.6% from 28.0%; those who think jobs are hard to get was nearly unchanged at 19.9%. Looking ahead, the number who expect more jobs to become available fell to 14.4% from 15.6%. Those who expect fewer jobs to be available dropped to 16.7% from 17.3%. Those who think their incomes will increase in the months ahead was flat at 17.7%.

Buying plans were mixed, with more consumers planning to buy homes, carpets and cars, but fewer opting for major appliances or a vacation.

Buying plans in July
Plans to purchase over the next six months

Source: The Conference Board
Homes +6.3%
Carpets 6.7
Cars 14.5
Major appliances -5.5
Vacation -4.3

Confidence by region

Region % change
Source: The Conference Board
New England 9.7%
Middle Atlantic -5.0
East North Central -10.9
West North Central 8.5
South Atlantic 9.9
East South Central 3.7
West South Central -7.2
Mountain -5.9
Pacific 5.0

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