After declining for three straight months, American consumer confidence ticked up in November as the all-important holiday shopping season kicks into high gear.
The Conference Board, a business research group, said Tuesday that its consumer confidence index rose to 102 this month from 99.1 in October. Analysts were expecting a reading of 101. The October reading was revised down from an original reading of 102.6.
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The index measures both Americans’ assessment of current economic conditions and their outlook for the next six months.
The main index was boosted by respondents whose outlook for the next six months improved.
The index measuring Americans short-term expectations for income, business and job market rose to 77.8 in November from 72.7 in October. However, it was the third straight reading below 80 for future expectations, which historically signals a recession within a year.
The survey also showed that Americans' expectations of a recession in the next 12 months declined to the lowest level so far this year. Still, about two-thirds of those surveyed still expect a downturn before the end of 2024.
Consumer spending accounts for around 70% of U.S. economic activity, so economists pay close attention to consumer behavior as they take measure of the broader economy.
In September, spending by consumers rose by a brisk 0.4%, even as Americans face ever-higher borrowing costs. After a strong summer, economists forecast that consumer spending will slow in the final three months of the year, as credit card debt and delinquencies rise and average savings fall.
Americans did cut back on retail spending in October, ending six straight months of gains, though the decline was partly driven by falling prices for both gasoline and cars.
Though they continue to spend, inflation, geopolitical conflicts and higher interest rates remain at the forefront of American consumers’ minds.
Consumers’ view of current conditions this inched down modestly this month, to 138.2 from 138.6 in October.