Preliminary October Consumer Confidence Comes At 69.4, Below September 73.5 And Below Expectations Of 73.5
The Reuters/University of Michigan index fell to 69.4 in early October,
below the 73.5 final September reading, and below economists' expectations of unchanged (73.5). The biggest factor for the drop was the decline in consumer expectations which was down a substantial 5.9 points to 67.6, well below expectations, while current conditions came in at 72.1, in line with consensus.
Additionally, consumers now expect inflation to pick up to 2.8% in the upcoming year, well above the prior month's 2.2%. As this is very volatile series, and as the consumer in general is easily influenced by such indications of price and not value as the stock market, expect future data to continue fluctuating wildly.
Most interesting is the divergence between personal financial situation assessment and the overall optimism on the economy (which also is starting to decline). From Reuters:
Survey director Richard Curtin noted that while consumers expected
gains in the general economy and for unemployment to reach cyclical
peaks, there has been no positive improvement in their assessment of
their personal financial situation. 'The divergence between prospects
for the general economy and personal finances is unique in the history
of the surveys, and can be expected to have a negative impact on the
pace of the recovery,' Curtin said.