Consumer Comfort in U.S. Rose Last Week by Most in Three Monthsby
Americans' views of their finances reaches nine-week high
Sentiment improved in five of seven income brackets last week
Consumer confidence rebounded last week by the most in three months as Americans grew more upbeat about the economy, their finances and the buying climate.
The Bloomberg Consumer Comfort Index rose to 41.9, the first advance in four weeks, from 40.2 the week prior. The 1.7 point gain was the biggest since the period ended June 21 and brings the gauge to it’s highest reading in a month.
The pickup coincides with last week’s Federal Reserve policy meeting and shows consumers may be embracing the central bank’s decision to hold interest rates at historic lows. While the stock market remains volatile, sentiment is also being bolstered by fewer job cuts, more hiring and falling gasoline prices.
”The recovery counters pessimism about the current condition and direction of the national economy,” Gary Langer, president of Langer Research Associates, which compiles the survey for Bloomberg, said in a statement. ”Markets have stabilized in recent weeks after a tumultuous August, with robust growth in retail sales and labor market gains. Analysts see these as likely to continue after the Fed’s decision."
The measure of Americans’ views of their personal finances rose to 56.4, the highest in two months, from 54.9 the week prior. The index tracking buying climate, indicating whether consumers think now is a good time to purchase goods and services, increased to 36.6 from 34.9. While the measure of the economy improved to 32.6 from 30.9, it’s still below the average for the year.
Sentiment improved in five of seven income brackets, with confidence for those earning $100,000 plus reaching the highest level in more than two months. Confidence for households earning $25,000 to $40,000 showed the biggest improvement rallying to its highest level since early May, while comfort for households earning $15,000 to $25,000 decreased to their lowest since last October.
Confidence picked up in all four regions, with those in the Northeast the most upbeat.