Con­sumer con­fi­dence in­dex hits 9-year high

Daily Local News (West Chester, PA) - - BUSINESS - By Martin Crutsinger AP Eco­nom­ics Writer

WASH­ING­TON » U.S. con­sumer con­fi­dence in Septem­ber rose to the high­est level in nine years, a hope­ful sign that eco­nomic growth will ac­cel­er­ate in com­ing months.

The Con­fer­ence Board said Tues­day that its con­sumer con­fi­dence in­dex rose to 104.1, up from 101.8 in Au­gust. It was the strong­est read­ing since the in­dex stood at 105.6 in Au­gust 2007, four months be­fore the be­gin­ning of the Great Re­ces­sion of 2007-2009.

Pri­vate econ­o­mists had been fore­cast­ing the in­dex would drop in Septem­ber af­ter a strong Au­gust read­ing. Many an­a­lysts ex­pected that re­cent volatil­ity in the stock mar­ket and some sub­par eco­nomic read­ings on auto sales and man­u­fac­tur­ing might lead con­sumers to feel less con­fi­dent.

They also thought that in­creased un­cer­tainty re­volv­ing around the pres­i­den­tial cam­paign might weigh on con­sumers.

“It ap­pears that steady job gains, low volatil­ity in eq­uity mar­kets and sub­dued gaso­line price pres­sures are helping con­sumers’ out­looks,” an­a­lysts at Con­tin­gent Macro Re­search said in a note to clients.

Con­sumers’ views about cur­rent eco­nomic con­di­tions and ex­pec­ta­tions about future eco­nomic con­di­tions both rose in the sur­vey, a de­vel­op­ment which econ­o­mists said should help boost con­sumer spend­ing and the over­all econ­omy in com­ing months.

“Still solid job growth will con­tinue to sup­port con­sumer con­fi­dence, which will drive eco­nomic growth,” said Jen­nifer Lee, se­nior econ­o­mist at BMO Cap­i­tal Mar­kets.

The over­all econ­omy, as mea­sured by the gross do­mes­tic prod­uct, has grown at a lack­lus­ter rate av­er­ag­ing 1 per­cent over the past nine months. But fore­cast­ers be­lieve GDP growth will ac­cel­er­ate to around 3 per­cent in the cur­rent Ju­lySeptem­ber quar­ter.

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