Great again? November consumer confidence highest since pre-Obama era

posted at 10:31 am on November 30, 2016 by Larry O'Connor

According to CBS MarketWatch, US consumer confidence in November rose to its highest levels since 2007:

The consumer-confidence index rose to 107.1, the highest since July 2007, the Conference Board said Tuesday. The index had reached a 20-month high of 103.5 in September but pulled back in October to a revised 100.8.

Economists polled by MarketWatch had expected the index to rise to 102 in November from an initial October estimate of 98.6.

U.S. stocks, namely the S&P 500 index SPX, +0.13% and the Dow Jones Industrial Average DJIA, +0.12% which had been trading near break-even levels in the morning before the confidence data was released, edged slightly higher afterward.

The Obama Administration will surely leap on these numbers and try to make the case that this is a result in their policies taking hold in the economy, but other evidence suggests these numbers are a direct response to the presidential election.

Last week, Bloomberg reported on a separate consumer confidence survey conducted by the University of Michigan which broke their survey down into pre-election and post-election reactions.

The University of Michigan said Wednesday that its final index of sentiment rose to 93.8 from 87.2 in October, after a preliminary reading of 91.6 that reflected pre-election views. The split was stark between respondents in the month’s survey before and after the Nov. 8 vote, with sentiment rising 8.2 points in the post-election group from the pre-election cohort.

The lift suggests that Americans were heartened on the whole by Trump’s victory over Democrat Hillary Clinton, with broad gains in confidence across incomes, ages and regions, according to the report. At the same time, the increase may reflect a “honeymoon” period that could fade unless actual economic conditions improve, said Richard Curtin, director of the Michigan survey.

Maybe the American consumer, fatigued by the relentless and never-ending presidential campaign, was just happy to have it over with and was ready to move on to the important business of spending their money. Or, maybe this is a direct response to President-elect Trump being the victor over Hillary Clinton.

One thing is certain: Consumer confidence hasn’t been this high during the entire Obama presidency.

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