Posted on Monday, October 4, 2010
September consumer confidence in the United States slipped to its lowest levels since February, driven by a deteriorating labor market and business conditions, according to a private report released Tuesday.
The Conference Board, an industry group, said its index of consumer attitudes fell to 48.5 points in September, from a revised 53.2 in August.
Inflation expectations eased slightly, even after the Federal Reserve said it was ready to take action to keep yields down in an effort to stimulate growth. Consumers’ one-year inflation expectations edged down to 4.9 percent, from 5.0 percent the previous month.
The median of forecasts from analysts polled by Reuters was for an overall September reading of 52.5. Forecasts ranged from 48.0 to 55.0.
The August reading was revised down slightly from an original 53.5.
The expectations index slipped to 65.4 from 72.0 last month, and the present situation index slipped to 23.1 from 24.9 in August.
Consumers’ labor market assessment also worsened. Those who said jobs were “hard to get” rose to 46.1 percent from 45.5 percent, while the share that described jobs as “plentiful” decreased to 3.8 percent from 4 percent.
Also, single-family home prices fell in July, and were seen stabilizing near the lows without the homebuyer tax credit that ended in April, the Standard & Poor’s/Case-Shiller home price indexes showed Tuesday.
The composite index of 20 metropolitan areas declined 0.1 percent in July from June on a seasonally adjusted basis, as expected in a Reuters poll. The dip followed a 0.2 percent June rise, which was revised down from a 0.3 percent increase.
Unadjusted, the 20-city index gained 0.6 percent after June’s 1 percent gain. A 0.4 percent rise was expected.
Home prices in the 20 cities index rose 3.2 percent from July 2009, a slower annual pace than the 4.2 percent increased in June, the index reported.
Ten of the cities had annual gains, and only Las Vegas set a new low, as the impact of the homebuyer tax credit faded away, S.& P. said. But the year-over-year growth rates slowed in 16 of the cities and both the 10- and 20-city composite indexes in July from the previous month.
“While we could still see some residual support from the homebuyers’ tax credit, which covers purchases closing through Sept. 30th, anyone looking for home prices to return to the lofty 2005-2006 levels might be disappointed,” David M. Blitzer, chairman of the index committee at S.& P., said in a statement.
“Housing starts, sales and inventory data reported for August do not show signs of a robust market, and foreclosures continue,” he said, adding “stable prices seem more likely.”
The 20-city index showed home prices remained 27.9 percent below the peaks set in mid-2006.