The Conference Board's Consumer Confidence Index® rose significantly more than expected in October, rising 7.5 points to 91.7. The index was far above the forecast of 81.2.
Key Takeaways
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The Conference Board's Consumer Confidence Index® increased by 7.5 points to 91.7 in October, far above the forecast of 81.2.
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The Present Situation Index increased by 8.6 points to 120.4.
- The Expectations Index increased 6.9 points to 72.6, staying below the recessionary 80.0 threshold since February 2025.
The Present Situation Index, which is based on consumers' assessment of current business and labor market conditions, increased 8.6 points to 120.4. Meanwhile, the Expectations Index, which is based on consumers' short-term outlook for income, business, and labor market conditions, increased by 6.9 points to 72.6. Note that a level of 80 or below for the Expectations Index historically signals a recession within the next year and the index has been below 80 since February 2025.
“Consumer confidence advanced in October, driven primarily by improved perceptions of current and expected business conditions,” said Fergus McCormick, Senior Economist, Global Indicators, The Conference Board. “The recovery was in line with retail gasoline prices easing from September to October. Yet, despite the increase in October, consumer confidence remained on the long-term downward trend that’s persisted over the past few years. Consumers planned less spending on services and durable goods over the next six months. This likely reflected higher price levels and persistent inflation, which eroded consumers’ purchasing power.”
“Among write-in responses in October, consumers continued to express frustration with rising costs. References to prices, the high cost of food and groceries, and oil and diesel prices rose. Comments about war and conflict eased for a second straight month but remained elevated. Mentions of jobs and employment as an area of concern also ticked up, though to a lesser extent.”
Consumers’ average 12-month inflation expectations declined in October but remained elevated at 5.8%. Consumers still expected higher interest rates over the next 12 months. Overall, more consumers in October expected stock prices to increase rather than decrease in the next 12 months.
Background on the Consumer Confidence Index
The Conference Board Consumer Confidence Index measures the consumers attitudes and confidence in the economy, business conditions, and labor market, with higher readings indicating higher optimism. The general assumption is that when consumers are more optimistic they will spend more and stimulate economic growth. However, if consumers are pessimistic then spending will decline and the economy may slow down. The index is based on a 5 question survey, with 2 questions related to present conditions and 3 questions related to future expectations. The survey began in 1967 and was conducted every two months but changed to monthly reporting in 1977.
