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The Consumer Confidence Index fell to 53.1 percent in September. The dip, down from 54.5 points in August, reversed some of August’s 7-point gain.
The monthly index is part of the Consumer Confidence Survey, drawn from a sample of 5,000 U.S. households. Consumers seemed more pessimistic about the present and short-term than the future. While the Present Situation Index decreased to 22.7 from 25.4 in August, the Expectations Index—which gauges consumer predictions six months or more in the future—dropped only 0.5 points, to 73.3 from 73.8 last month.
But even looking further ahead, those expecting an improvement in business conditions over the next six months dropped slightly to 21.3 percent, from 22.2 percent.
This shift may not indicate a significant change in consumer attitudes as much as a sense of caution setting in about the pace of the recovery. “I don’t think that people’s expectations for the economy have changed much, they are just realizing that this isn’t going to happen quite so quickly and be that perfect rebound they were hoping for,” said Colin Read, a professor of economics and finance at the business school at SUNY Plattsburgh, and author of the recently published “The Fear Factor.” “There’s an expectation that in the next six months or a year, or a year and a half, things will start getting back to normal. We’re starting to accept that but we’re starting to become impatient wondering why it needs to take that long.”
Consumers saw current conditions as less favorable this month than last month, with those who believed business conditions were “bad” increasing from 44.6 to 46.3 percent and those considering jobs are “hard to get” rising from 44.3 to 47 percent.
“We’ve seen a lot of buoyancy and recovery in the last few months, but it’s just coming home to roost that this recovery is going to be slow and long and somewhat jobless,” said Read. “That early optimism is just being tempered with more realism.”