Slightly stronger views of the present situation help offset weaker expectations.
WASHINGTON – Consumer confidence saw a slight dip in October, but consumers seem to have a more positive outlook on the current conditions, according to the latest report from the Conference Board.
The Consumer Confidence Index squeaked down 1.0 point to 94.6 for the month of October from a slightly revised 95.6 in September. However, consumers had a better showing towards current labor and business conditions as the Present Situation Index gained 1.8 points to hit 129.3.
While the present outlook was positive, consumers have a lesser view on the future, according to the report. The Expectations Index declined to 71.5, dropping 2.9 points and staying well below the threshold of 80 that typically signals a recession ahead. The index has remained below the 80-mark since February.
“Consumer confidence moved sideways in October, only declining slightly from its upwardly revised September level,” said Stephanie Guichard, senior economist of global indicators at the Conference Board. “Changes to the individual subcomponents were also limited and largely cancelled each other out. The Present Situation Index regained some strength after September’s drop. Consumers’ view of current business conditions inched upward, while their appraisal of current job availability improved for the first time since December 2024. On the other hand, all three components of the Expectations Index weakened somewhat.”
Inflation concerns remain somewhat elevated, with the 12-month inflation expectations inching up to 5.9% from 5.8% in September. More than half of consumers (52.8%) also expect interest rates to increase.
“Consumers’ write-in responses were led by references to prices and inflation, which continued to be the main topic influencing consumers’ views of the economy,” Guichard said. “References to tariffs declined further this month but remained elevated. Mentions of jobs and employment eased somewhat after picking up in September. The write-in comments remained mostly negative overall, but less so than in previous months.”
Here are some other key points from this month’s report:
Present situation
Consumers’ assessments of current business conditions improved in October.
- 20.2% of consumers said business conditions were “good,” up from 19.9% in September.
- 14.7% said business conditions were “bad,” down from 15.3%.
Consumers’ views of the labor market also improved in October.
- 27.8% of consumers said jobs were “plentiful,” up from 26.9% in September.
- Still, 18.4% of consumers said jobs were “hard to get,” up from 18.2%.
Expectations 6 months hence
Consumers were a bit more pessimistic about future business conditions in October.
- 19% of consumers expected business conditions to improve, down from 19.3% in September.
- 22.6% expected business conditions to worsen, unchanged from last month’s revised reading.
Consumers were more worried about the labor market outlook in October.
- 15.8% of consumers expected more jobs to be available, down from 16.6% in September.
- 27.8% anticipated fewer jobs, up from 25.7%.
Consumers’ outlook for their income prospects was slightly less positive in October.
- 17.9% of consumers expected their incomes to increase, down from 18.2% in September.
- 12.5% expected their incomes to decrease, up from 11.7%.
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