Consumer confidence rises to higher-than-expected level in September
Tuesday, September 26th 2006, 9:44 am
News On 6
NEW YORK (AP) _ Falling gasoline prices helped brighten the mood of American shoppers in September, sending a gauge of consumer sentiment higher than analysts expected.
The New York-based Conference Board said Tuesday that its consumer confidence index rose to 104.5 from a revised reading of 100.2. in August. Analysts had expected the index to rise to 103. The reading, the highest since July's 107, followed a big dip in August, when employment worries dragged down consumer sentiment.
The private research group's Present Situation Index, which measures how shoppers feel now about economic conditions, rose to 127.7 from 123.9. Its Expectations Index, which measures consumers' outlook over the next six months, rose to 89.0 from 84.4 last month.
``A more favorable assessment of current conditions coupled with a less pessimistic short-term outlook boosted consumer confidence this month,'' said Lynn Franco, director of The Conference Board Consumer Research Center, in a statement.
One bright spot is that over the past month, the retail price of gasoline plunged by 50 cents, or 17 percent, to average $2.38 a gallon nationwide, according to Energy Department statistics. That is 42.5 cents lower than a year ago, when the energy industry was still reeling from the aftermath of hurricanes Katrina and Rita.
Despite lower prices at the pump, analysts are concerned that the cooling housing market and other factors could hurt consumer confidence in the longer term.
Franco cautioned that ``...even though consumers' concerns have eased, there is little to suggest a significant change in economic activity as we enter the final quarter of 2006.''
Stocks rose modestly Tuesday as investors digested further evidence of weakness in the housing sector and improved consumer confidence figures. In the first hour of trading, the Dow Jones industrial average rose 33.30, or 0.29 percent, to 11,609.11.