US con­sumer con­fi­dence jumps to high­est level in nine years

Jamaica Gleaner - - BUSINESS - – AP – AP

UNITED STATES con­sumer con­fi­dence re­bounded this month to the high­est level in more than nine years as Amer­i­cans ap­peared un­fazed by a tu­mul­tuous elec­tion cam­paign.

The Con­fer­ence Board said Tues­day that its con­sumer con­fi­dence in­dex reg­is­tered 107.1 in November, up from 100.8 last month and the high­est since July 2007.

Amer­i­cans’ as­sess­ment of cur­rent eco­nomic con­di­tions was also the sun­ni­est since July 2007. Their ex­pec­ta­tions for the next six months were the most op­ti­mistic since June 2015.

The survey was mostly taken be­fore the November 8 elec­tion. Con­fer­ence Board econ­o­mist Lynn Franco says that “it ap­pears from the small sample of post-elec­tion re­sponses that con­sumers’ op­ti­mism was not im­pacted by the out­come”.

POS­I­TIVE IM­PACT

The in­dex had fallen in Oc­to­ber and was ex­pected to rise this month, but the strength of the re­bound took economists by sur­prise.

“The elec­tion re­sult has had a clear pos­i­tive im­pact on sen­ti­ment,” An­drew Hunter, US econ­o­mist at Cap­i­tal Eco­nom­ics, wrote in a re­search note. “It also sup­ports our view that con­sumer spending will con­tinue to rise at a de­cent pace over the rest of the year.”

Economists mon­i­tor the mood of con­sumers be­cause their spending drives growth, ac­count­ing for al­most 70 per cent of US eco­nomic out­put.

The US econ­omy looks healthy. The gov­ern­ment re­ported Tues­day that the econ­omy grew at a 3.2 per cent an­nual pace from July to Septem­ber, the fastest in two years. Con­sumer spending ad­vanced at a 2.8 per cent an­nual pace in the third quar­ter, bet­ter than a pre­vi­ous es­ti­mate of 2.1 per cent.

The un­em­ploy­ment rate is 4.9 per cent, close to what economists con­sider full em­ploy­ment. Em­ploy­ers have added an av­er­age 181,000 jobs a month so far this year, down from 229,000 a month in 2015 but still solid.

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