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August 28, 2018 Blog 1 min read
The overall mood of the consumer sector is still very upbeat and the outlook for spending remains quite positive as well.
82818 Consumer Confidence ChartAny suggestion that the consumer mood was faltering may have been premature, as the late August iteration of the Conference Board’s survey of consumers reached its highest point since October 2000. The Conference Board Consumer Confidence Index surged in August to 133.4, easily beating expectations for a modest decline to 126.8.

The broad mood of the consumer not only remains quite positive, but also still appears to be gradually improving. Survey results had softened in recent months, but (to paraphrase Mark Twain) the August surge suggests that any rumors of the “death of consumer optimism” have been greatly exaggerated.

In recent months, the growing trade row between the U.S. and its trading partners and evidence that long-dormant inflation pressures were building were increasing sources of concern. Both represent risks, but for now, the economy remains on a solid growth path accompanied by strong job creation. Although consumers are certainly aware of those risks, they remain much more focused on what is going right with the economy than with what could go wrong.

More recently, consumers appear to be not only upbeat about current economic conditions, but more optimistic about the near-term outlook as well. That suggests a degree of skepticism about trade, inflation, or anything else knocking the economy off track. Should either of those evolve into a larger problem, consumers may be caught by surprise.

For now though, consumers remain resiliently positive. That bodes well for household spending in the coming months, and should keep a key pillar for the strength of the overall economy firmly in place.
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