Number: Falling gas prices have made Americans feel a lot better. The US Consumer Confidence Survey jumped to a five-month high of 108 in September.
A robust labor market and rising wages have also given Americans confidence, the nonprofit conference committee said Tuesday. is rising at the fastest pace in
Economists polled by The Wall Street Journal had expected the index to rise to 104.5 from last month’s revised 103.6.
Big picture: Falling gas prices eased fears among Americans feeling the pain of high inflation. But now, rising interest rates are increasing the cost of borrowing for homes, new cars, and other big-ticket items.
The Federal Reserve is raising interest rates sharply in an attempt to curb the highest inflation in 40 years. Rising interest rates will slow the economy, and a growing number of economists believe another recession is likely by next year.
The Federal Reserve is concerned that the toughest labor in decades is exacerbating already high inflation. Central banks aim to slow the economy enough to reduce labor demand and even increase unemployment.
Key details: A measure of how consumers currently feel about the economy rose to 149.6 in September from 145.3 the previous month.
A similar confidence gauge for forecasting six months ahead rose from 75.8 to 80.3. This is the highest level in seven months.
Looking ahead: “Improving confidence may bode well for consumer spending in the final months of 2022, but rising inflation and interest rates remain strong headwinds to growth in the near term.” ,board.
Market reaction: Dow Jones Industrial Average DJIA,
S&P 500 SPX,
It rose in Tuesday trading, bucking a series of sharp declines.
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