U.S. consumer confidence rebounded in September, the Conference Board said Tuesday (Sept. 26).
CBS MarketWatch reported that the consumer confidence index rose to 104.5 in September from a revised nine-month low of 100.2 in August.
The rebound was stronger than expected. Economists had forecast the index to increase to 102.7 from the initial August reading of 99.6, according to a survey conducted by MarketWatch.
Stocks moved higher immediately after the confidence report was released.
Economists cited lower gasoline prices as the principal reason for forecasting the increase in confidence.
Confidence has trended lower after reaching a peak of 109.8 in April because of high gas prices during the summer-driving season.
The present situation index increased to 127.7 from 123.9, still below July’s level.
The expectations index, seen as a better predictor of consumer spending, rose to 89.0 from 84.4 in August. This is the highest level since April.
Lynn Franco, director of The Conference Board Consumer Research Center, said consumer concerns about the economy have eased, but “there is little to suggest a significant change in economic activity as we enter the final quarter of 2006.”
The outlook for the labor market was mixed in September. The number of consumers who said jobs are “plentiful” rose to 25.9% from 24.5%. Those claiming jobs are “hard to get,” however, also edged up to 21.3% from 21.2% in August.
Consumers’ outlook for the next six months was less pessimistic in September.
Those anticipating business conditions to worsen fell to 10.6% from 12.9% in August. Those expecting business conditions to improve held steady at 16.3%.
Expectations of inflation in the next year fell to 4.9% in September from 5.5% in August. This is the lowest level since March.