US consumer confidence remains weak in September
US consumer confidence remained weak in September, the Conference Board has reported.
The closely-monitored Consumer Confidence Index from the Conference Board edged higher to 45.4 this month from August’s upwardly revised reading of 45.2.
However, not only was the reading less than forecasts of a level of 46.6, it was the lowest since April 2009 when the economy was in the midst of a recession.
Furthermore, the index remains far away from the 90 points required to show that the world’s largest economy is on solid footing.
Since the index commenced in 1967, the average reading has been 95.6.
Commenting on the figures, Lynn Franco, director of the Conference Board Consumer Research Centre said: “The pessimism that shrouded consumers last month has spilled over into September. Consumer expectations, which had plummeted in August, posted a marginal gain.
“However, consumers expressed greater concern about their expected earnings, a sign that does not bode well for spending. In addition, consumers’ assessment of current conditions declined for the fifth consecutive month, a sign that the economic environment remains weak.”
This will be a cause for concern since consumer spending is closely monitored as it accounts for more than two-thirds of economic output.
Earlier this month, the Commerce Department revealed retail sales stagnated last month.
Sales were flat from the month earlier after July’s figure was revised down to 0.3% from 0.5%.
However, not only is consumer spending a concern, the economic recovery in the US remains sluggish in the face of higher unemployment and a depressed housing market.
The Labor Department recently revealed the US economy added no new jobs last month, which was a surprise after markets had expected 70,000 new jobs.
This represented the first time since 1945 that there has been a zero payrolls figure after 17,000 jobs were added in the private sector last month but these were cancelled out by 17,000 jobs lost in the public sector.
Meanwhile, in other US news this week, it has been revealed that house prices rose 0.9% in July compared with June when values rose 1.2%.
On an annual basis, however, prices are 4.1% lower.
The US housing market has remained in the doldrums for some time now and many have suggested it is holding back the recovery of the world’s largest economy but the latest figures suggest the housing market may be stabilising.
However, demand for housing in the US remains weak, despite mortgage rates hovering at record lows and falling house prices – the latter due to millions of home repossessions.