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Confidence index low

first_img AD Quality Auto 360p 720p 1080p Top articles1/5READ MOREThe top 10 theme park moments of 2019 “Consumers are apprehensive. They are apprehensive about energy prices. They are apprehensive about rising interest rates. They are apprehensive about their low level of savings,” said Carl Tannenbaum, chief economist at LaSalle Bank. “This may lead to a little bit of rethinking of their spending habits, which could have an important influence on economic growth.” Economists monitor confidence for indications about consumers’ willingness to spend, which plays a major role in shaping the strength of overall economic activity in the United States. Shoppers stuck to the basics in September and shied away from nonessentials, leaving many mall-based stores disappointed, retailers reported Thursday. That – along with the anxious state of consumers – cast a pall over prospects for a merry holiday sales season, some economists said. The October confidence report showed that a continuing source of nervousness for consumers’ concerns is their economic expectations over the next six months, including conditions in areas where they live or work and their own financial situations. This “expectations” measure did move back into positive territory in October but nonetheless came in at a weak reading of 0.9. In September, this measure plunged to a negative 13.5, the worst showing on record and the first time this gauge fell into the negative zone. WASHINGTON – Consumer confidence remains low, with high energy prices, war and fallout from hurricanes Katrina and Rita sapping American’s enthusiasm about the nation’s economic health and their own. The RBC CASH Index, based on polling by Ipsos, showed that consumer confidence clocked in at 66.8 in October. That was up slightly from September’s reading of 61.5, the lowest since early March 2003 when the nation was on the brink of war. The confidence index is benchmarked to a 100 reading on January 2002, when Ipsos, an international polling firm, started the gauge. A year ago, confidence stood at a buoyant 97.4. But consumers are much less assured now, weighed down by high energy prices, death and destruction on the Gulf Coast, continued bloodshed in Iraq and other things. Consumers’ feelings about economic prospects over the next six months have seriously deteriorated over the past 12 months. In October 2004, this expectations barometer came in at an energetic 95.3. “They feel a lot less assured about the economy’s outlook,” said Richard Yamarone, economist at Argus Research. Analysts believe that a host of factors are behind the erosion. Those factors include high gasoline prices and expected increases in winter home-heating bills; fears that the housing boom could suddenly go bust; concerns about rising interest rates, which are pushing up the cost of mortgages, payments on credit cards, home equity lines of credit and other consumer loans; and the low levels of personal savings, which offers little cushion for unexpected finances. The Federal Reserve has been tightening credit since June 2004 and is expected to push borrowing costs higher in the months ahead to keep inflation under control. The Fed’s action thus far has caused commercial banks’ prime lending rate to rise to 6.75 percent, the highest in four years. These rates are used for many short-term consumer loans. Consumers’ sentiments about making a purchase, saving and other investment decisions dipped to 78 in October, from 80.7 in September. A year ago, this measure stood at 93.3. A measure tracking consumers’ feelings about current economic conditions came in at 90.7 in October, down from 92 in the previous month. In October 2004, this gauge was 95.1. Surprisingly, consumers’ thoughts about the job market improved, rising to 119.5 in October compared with 111.7 in September. A year ago this measure was at 112.1. The overall consumer confidence index for October was based on the results of 1,000 adults surveyed Monday through Wednesday about their attitudes on personal finance and the economy. Results of the survey had a margin of error of plus or minus 3.1 percentage points. 160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set!last_img

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