Consumer Confidence Soars just before Election Day

October 29, 2024 TruthUSA

Consumer sentiment showed a significant improvement in October, driven by growing confidence in the labor market and a positive outlook for the economy following the upcoming election.

October saw consumer confidence reach a nine-month high, fueled by increased optimism about the state of the U.S. job market and a more positive view of the economy in the months after the upcoming presidential election.

The Consumer Confidence Index, as reported by the Conference Board, rose to 108.7 this month, up from a revised 99.2 in September, marking the largest monthly increase since March 2021.

Consumers’ perceptions of business conditions turned positive in October, with a higher percentage expressing optimism compared to the previous month.

Assessments of current financial situations remained steady in October, with more consumers describing it as “good” rather than “bad,” similar to recent months.

Labor market assessments also improved, with more consumers noting that job opportunities were abundant and fewer indicating challenges in finding employment.

“Views on the current job market availability rebounded after a period of weakness, potentially reflecting better labor market data,” said Dana Peterson, chief economist at the Conference Board.

The latest jobs report from the Bureau of Labor Statistics, released on Oct. 4, showed a significant increase in nonfarm payroll employment, exceeding market expectations and signaling positive momentum in the job market.

The strong jobs data received positive feedback from analysts, with some indicating that it dispelled concerns of an imminent economic downturn.

In addition to boosting consumer confidence, the robust jobs report helped alleviate fears of a recession. The Conference Board’s report indicated a sharp decline in recession concerns in October, with fewer consumers foreseeing an economic contraction in the coming year.

“The proportion of consumers anticipating a recession in the next 12 months hit a record low in October, along with a decrease in those believing the economy is already in a recession,” stated Peterson.

Forward-looking assessments also showed improvement, with consumers feeling optimistic about future income, business conditions, and job availability.

However, a new government report from Oct. 29 revealed that more employers have paused their hiring plans, and employees are holding onto their current positions.

Data from the Job Openings and Labor Turnover Summary report showed a reduction in job openings in September, alongside a decrease in resignations, indicating reduced confidence among workers in finding alternative employment.

While inflation concerns persist among consumers, the latest Conference Board report highlighted that mentions of high prices and inflation continued to dominate responses in October.

Despite a slowdown from peak levels, consumers’ expectations for future inflation showed a slight increase in October.

Leaders in the financial sector have expressed differing views on inflation, with concerns about government policies fueling inflationary pressures.

Post-election, the direction of inflation remains uncertain, with various policies being proposed that could impact economic growth and inflation levels.

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