The Conference Board released the Consumer Confidence Index for November, reporting that the index dropped sharply to 90.4 in November, following a moderate decrease in October. Both subcomponents contributed to the decline. The present situation index declined to 108.1 from 114.6 in October; the expectations index slipped to 78.6 from 88.7 in October.
Compared to October, in November, the decline in indexes showed that some respondents were less optimistic about both the present situation and the short-term outlook. Particularly, more than half of respondents reported that present jobs were not so plentiful, and didn’t anticipate that there would be more jobs in the upcoming six months.
Consumers also downgraded their assessments of business conditions. Smaller shares of respondents believed that business conditions were “good” at present and would be “better” in the upcoming six months; larger shares of respondents reported that business conditions were “normal” at present and would remain at the same level in the upcoming six months.
The Conference Board also reports on the share of respondents planning to buy a home within six months. The data is volatile month to month but has trended up since the end of the recession. It is interesting to note that while new construction has historically been roughly 16% of all single family home sales, the dynamics of the new home and existing home markets are quite similar during both the most recent recession and recovery, as well as over earlier economic cycles.