American consumers continued to indicate a higher level of confidence in the nation’s economy this month, due in part to a more favorable job market, The Conference Board recently reported. The organization’s Consumer Confidence Index increased for the second consecutive month in January, rising to 110.3 (1985=100). Also in January, the Present Situation Index increased to 133.9, while the Expectations Index declined to 94.5. Together, the three indexes suggest moderate economic growth during the first quarter of 2007.
Despite the current level of consumer confidence, consumers’ outlook for the coming months is less positive, as indicated by the falling Expectations Index. According to the report, fewer consumers anticipate business conditions or their wages to improve in the near term. "This month’s slight increase in confidence was solely the result of an improvement in the Present Situation Index, fueled primarily by a more favorable job market," said Lynn Franco, director of The Conference Board Consumer Research Center. "Looking ahead, however, consumers are not as optimistic as they were in December."