Consumer confidence surveys are important private sector surveys even though economists view them as lagging indicators. Their importance lies in the confirmation of spending patterns. As consumption in developed countries may amount to 60%-70% of GDP, knowing how it is behaving is important for financial markets’ forecasts of GDP growth rates, which in turn flow into credit growth and inflation rates.
The August reading of the Conference Board’s Consumer Confidence Index came in at 122.9, up from July’s revised reading of 120.0 and much higher than 2016’s comparable August figure of 101.8. Lynn Franco, Director of Economic Indicators at The Conference Board, said consumers perceived existing conditions had improved since July while their expectations of the near-future were unchanged but still relatively optimistic. The index was the result of a survey which ended on 16 August 2017.
The Conference Board index is one of two U.S. consumer sentiment indices, the other being the University of Michigan’s Consumer Sentiment Index. The Conference Board’s index is based on perceptions of current business and employment conditions, as well as expectations of business conditions, employment and income six months into the future.