Consumer confidence increases in January
Turmoil on Wall Street isn’t bothering consumers, as consumer confidence in January rises.
The Conference Board reported that consumer confidence rose to 98.1 from a reading of 96.3 in December. That was above the 96.2 seen in a MarketWatch-compiled consensus and the best reading since October.
It’s been a rough start to the year on the stock market. The Dow Jones Industrial Average closed Monday with an 8.8% loss year to date.
But that hasn’t bothered consumers. A similar report, the University of Michigan’s consumer sentiment index, also rose in January.
“For now, consumers do not foresee the volatility in financial markets as having a negative impact on the economy,” said Lynn Franco, director of economic indicators at The Conference Board.
“A resilient labor market and low gasoline and utilities prices seem to have offset any negative sentiment stemming from financial markets,” added Derek Lindsey of BNP Paribas.
Ahead of the report, Ian Shepherdson, chief economist of Pantheon Macroeconomics, correctly surmised that the stock-market drop wouldn’t show up in the January reading, because stock-market trouble usually impacts consumer confidence with a lag. “People wait to see the damage in black and white in their mutual fund or brokerage account statements,” he said.
Like Lindsey, Shepherdson also noted the positive impact from low gasoline prices on consumer confidence.
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