US: Consumer confidence rebounds but income expectations remain pessimistic - Wells Fargo

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Dec 29, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Córdoba) - Today’s report by the Conference Board showed an increase in the consumer confidence index that climbed to 96.5, above expectations of a reading around 93.8. According to economists from Wells Fargo attitudes about the labor market improved notably, but consumers remain disheartened by sluggish income growth.

    Key Quotes:

    “Consumer confidence rebounded 3.9 points in December to 96.5, following a surprising 6.5-point drop in November. The November survey occurred prior to the Paris terrorist attacks, so December’s rebound included consumers’ assessment of any potential impact from that tragedy as well as the San Bernardino shootings, which occurred on December 2.”

    “Consumer confidence has averaged 96.0 over the past three months, which is down slightly from the 98.3 averaged during the third quarter. The dip in consumer confidence is consistent with our outlook for the economy, which calls for growth to decelerate during the fourth quarter.”

    “Consumers’ assessment of business conditions were mixed at best (…) Consumers’ expectations for the first half of 2016 varied. Fewer expect business conditions to get better and slightly more expect conditions to worse.”

    “Consumers do feel modestly better about employment prospects, but the proportion expecting more jobs to be created in the next six months remains near its low for the year at 12.9 percent, while the number expecting fewer jobs remains in line with its average for the year at 16.6 percent. Attitudes about income growth improved slightly, with the proportion of consumers expecting income to decrease plunging 2.1 points to 9.7 percent. But fewer consumers also expect incomes to rise.”

    “The overwhelming majority, 74 percent, expect their income to remain the same over the next months. That may be a bit pessimistic, with reported income rising more rapidly, thanks to stronger job growth and rising hours worked.”
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