After Two Consecutive Monthly Gains, The Conference Board’s Consumer Confidence Index Slips in October

The Conference Board, a non-partisan, not-for-profit think tank founded in 1916, released today (10-25-22) its Consumer Confidence Index® (CCI) for October 2022. The CCI has declined after 2 consecutive months of growth. The Index now stands at 102.5 (1985=100), down from its September reading of 107.8.

The Present Situation Index—based on consumers’ assessment of current business and labor market conditions—declined sharply in October to a reading of 138.9, down from its September reading of 150.2.

The Expectations Index—based on consumers’ short-term outlook for income, business, and labor market conditions—decreased in October to a reading of 78.1, up from its September reading of 79.5.

Adding additional background and her analysis, Lynn Franco, Senior Director of Economic Indicators at The Conference Board, said:

“Consumer confidence retreated in October, after advancing in August and September. The Present Situation Index fell sharply, suggesting economic growth slowed to start Q4. Consumers’ expectations regarding the short-term outlook remained dismal. The Expectations Index is still lingering below a reading of 80—a level associated with recession—suggesting recession risks appear to be rising.

Notably, concerns about inflation—which had been receding since July—picked up again, with both gas and food prices serving as main drivers. Vacation intentions cooled; however, intentions to purchase homes, automobiles, and big-ticket appliances all rose. Looking ahead, inflationary pressures will continue to pose strong headwinds to consumer confidence and spending, which could result in a challenging holiday season for retailers. And, given inventories are already in place, if demand falls short, it may result in steep discounting which would reduce retailers’ profit margins.”