Consumer confidence slips but still near 18-year high
WASHINGTON – U.S. consumer confidence slipped this month but remains strong.
The Conference Board, a business research group, said Tuesday that its consumer confidence index fell to 135.7 in November from October’s 18-year high 137.9.
The index measures consumers’ assessment of current economic conditions and their outlook for the next six months. Their evaluation of today’s economy improved – but their assessment of future conditions slipped in November.
“Overall, consumers are still quite confident that economic growth will continue at a solid pace into early 2019,” says Lynn Franco, a Conference Board economist. “However, if expectations soften further in the coming months, the pace of growth is likely to begin moderating.”
Economists monitor consumer spirits because Americans’ spending accounts for about 70 percent of U.S. economic activity. From July through September, consumer spending rose at a 4 percent annual pace, fastest since late 2014.
Americans’ sunny mood reflects a strong job market. Unemployment has dropped to a five-decade low 3.7 percent. That is why 46.6 percent of respondents told the Conference Board that jobs are “plentiful” – the highest share since January 2001.
Economists are worried that U.S. economic growth could decelerate as the effect of last year’s tax cuts fades and President Donald Trump’s taxes on imports take a toll.
“Despite a modest decline in confidence and the recognition that the pace of economic growth is slowing, consumers remain an upbeat lot,” Jim Baird, chief investment officer at Plante Moran Financial Advisors, said in a research note. “For now, they also appear to be comfortable opening their wallets and purses, letting their spending speak clearly on their behalf.”