Consumer Confidence Index: Consumers are feeling the effects of the economy

Consumer confidence fell in October as inflation takes a toll on spending, according to the latest survey by the Conference Board and the American Bankers Association of 24,700 consumers. Consumer credit rose modestly in October, but was still 4.4 percent lower than a year earlier, the two boards said. Confidence in personal finances was weakest in October among those ages 18 to 24, but consumer confidence among those ages 25 to 44 was unchanged from the previous month.

The percentage of consumers that say their economic conditions will be better in three months fell in October to the second-lowest level since November 2000, according to the Conference Board’s Consumer Confidence Index. An economic downturn that started in December is a possibility. A reading of 50 means that the index is at the same level it was in September. The index was at 41.1 in July, down from 58.1 in January. An index reading below 50 indicates that the consumer is less optimistic about things in the next three months.

“The economy continues to weaken,” said John Silvia, director of the Consumer Business Services department at the Conference Board. “The consumer is feeling the effects. Consumers are being squeezed. There are now more than 7 million jobs being erased each month, but this is not helping the market.”

The Conference Board said the number of consumers who say they expect an improvement in their finances in the next three months jumped 3.5 percentage points in October to a reading of 71.4. The number of consumers expecting an improvement in their financial situation in three months was last measured in November 2000 at this level. The report also showed that the index of consumer attitudes towards personal finance has been in a slight upward trend, but is slightly below the long-term average. The index rose 0.7 percentage point in October to 77.0. The long-term average was 84.9. The index of consumer attitudes about money rose 0.3 percentage point to 67.3 in October. The long-term average was 75.8.

The Conference Board said the

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