Post by Moses on Dec 28, 2004 20:12:11 GMT -5
Business - Reuters
Consumer Confidence Rises in December
Tue Dec 28,12:58 PM ET
NEW YORK (Reuters) - U.S. consumer confidence (news - web sites) grew to a five-month high in December, bolstered by improved employment opportunities and cheaper energy, according to a report released on Tuesday.
Confidence in the economy was also given a boost earlier on Tuesday with the release of data showing U.S. chain store sales rose for the fourth week in a row in the week ending Dec. 25.
But the big market mover on Tuesday was the surprisingly strong consumer confidence data from The Conference Board (news - web sites), a New York business research group. The index rose to 102.3 in December, the highest level since July.
"The continuing economic expansion, combined with job growth, has consumers ending the year on a high note," said Lynn Franco, director of consumer research at The Conference Board.
The result easily topped both November's upwardly revised reading of 92.6 and economists' expectations.
The number sparked buying in the stock market and selling in the bond market, as investors in each market expressed their own brand of confidence in the economy.
The strong consumer confidence levels had debt investors thinking the Federal Reserve (news - web sites) will be more inclined to continue to boost official interest rates if economic confidence is growing. Higher interest rates mean lower debt prices.
The employment picture played a key role in the growth in confidence, with the number of consumers saying jobs are "plentiful" rising to 19.4 percent in December from 17.1 percent, while those claiming jobs are "hard to get" eased to 26.4 percent from 28.0 percent in November.
"The (headline) number does show that people feel jobs are much more plentiful and are more optimistic about spending," said Elisabeth Denison, economist at Dresdner Kleinwort Wasserstein in New York.
On the retail side, a last-minute holiday rush to the stores was not enough to make up for subpar retailer performance prior to the Christmas rush.
Sales at major retailers rose by 3.0 percent on a year-over-year basis for the week ended Dec. 25, but sales in December to-date were down 4.0 percent compared with November, according to Redbook Research, an independent company.
Also in some downside news for the economy, the Chicago Federal Reserve Bank said on Tuesday its Midwest manufacturing index slipped in November to 117.1 from a downwardly revised 117.5 in October.
The dip was mainly due to weaker automotive production. Midwest auto output compared with a year earlier fell 2.7 percent while national production rose by 3.1 percent.
Consumer Confidence Rises in December
Tue Dec 28,12:58 PM ET
NEW YORK (Reuters) - U.S. consumer confidence (news - web sites) grew to a five-month high in December, bolstered by improved employment opportunities and cheaper energy, according to a report released on Tuesday.
Confidence in the economy was also given a boost earlier on Tuesday with the release of data showing U.S. chain store sales rose for the fourth week in a row in the week ending Dec. 25.
But the big market mover on Tuesday was the surprisingly strong consumer confidence data from The Conference Board (news - web sites), a New York business research group. The index rose to 102.3 in December, the highest level since July.
"The continuing economic expansion, combined with job growth, has consumers ending the year on a high note," said Lynn Franco, director of consumer research at The Conference Board.
The result easily topped both November's upwardly revised reading of 92.6 and economists' expectations.
The number sparked buying in the stock market and selling in the bond market, as investors in each market expressed their own brand of confidence in the economy.
The strong consumer confidence levels had debt investors thinking the Federal Reserve (news - web sites) will be more inclined to continue to boost official interest rates if economic confidence is growing. Higher interest rates mean lower debt prices.
The employment picture played a key role in the growth in confidence, with the number of consumers saying jobs are "plentiful" rising to 19.4 percent in December from 17.1 percent, while those claiming jobs are "hard to get" eased to 26.4 percent from 28.0 percent in November.
"The (headline) number does show that people feel jobs are much more plentiful and are more optimistic about spending," said Elisabeth Denison, economist at Dresdner Kleinwort Wasserstein in New York.
On the retail side, a last-minute holiday rush to the stores was not enough to make up for subpar retailer performance prior to the Christmas rush.
Sales at major retailers rose by 3.0 percent on a year-over-year basis for the week ended Dec. 25, but sales in December to-date were down 4.0 percent compared with November, according to Redbook Research, an independent company.
Also in some downside news for the economy, the Chicago Federal Reserve Bank said on Tuesday its Midwest manufacturing index slipped in November to 117.1 from a downwardly revised 117.5 in October.
The dip was mainly due to weaker automotive production. Midwest auto output compared with a year earlier fell 2.7 percent while national production rose by 3.1 percent.