The Conference Board reading of consumer confidence increased sharply to 107.1 for November from an upwardly-revised 100.8 for October, which was originally reported as 98.6. This was the highest reading since the middle of 2007 and comfortably above market expectations of 101.2.
The present situation index strengthened to 130.3 from 123.1 previously, while the expectations index strengthened to 91.7 from 86.0 in October.
There was an increase in the proportion of consumers saying conditions were good from 26.5% to 29.2% with a significant decline in the number stating conditions are bad.
There was also an increase in the percentage stating that jobs were plentiful to 26.9% from 25.3% with no change in those claiming jobs are hard to get.
There was a decline in the percentage expecting business conditions to improve, although the number of pessimists also declined. The proportion expecting the number of jobs to increase was unchanged, while there was a significant decline in the numbers anticipating fewer jobs.
Most of the consumers were surveyed ahead of the Presidential and Congressional elections, but the small number of surveys received after the election did not suggest a major shift in the pattern.
The increase in confidence will boost near-term confidence in the outlook for consumer spending and the jobs market, although the overall correlations are relatively loose. Markets will also be looking to assess in next month’s data whether the election has had any impact on confidence.
The dollar was unable to derive any fresh benefit from the data with USD/JPY unable to hold above the 113.00 level and retreating to the 112.65 area on wider allocation shifts ahead of the month end with EUR/USD above the 1.0600 level. US Treasuries were able to resist further retreat and held with losses of around 8 ticks on the day, while S&P 500 futures were little changed.
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