US consumer confidence dips in September

Sentiment among US consumers dipped last month but confidence remained solid enough for many of them to be likely to continue to splash out, a widely-followed gauge showed.

The Conference Board institute's consumer confidence gauge slipped from a reading of 101.3 for September to 100.9 in October (consensus: 102.0).

A sub-index linked to how consumers evaluated their current situation, which tends to be linked to changes in unemployment, in fact improved from a reading of 98.9 for August to 104.6 in September.

Another sub-index, tied to their expectations, and which historically tends to follow movements in the stockmarket with a lag declined from 102.9 to 98.4.

Nevertheless, commenting on the data, Ian Shepherdson at Pantheon Macroeconomics cautioned that it could be a bit mistaken to tie the two in this case.

"Other factors, including the rising trend in Covid infections and the impact of the end of enhanced unemployment benefits, likely played a role too," Shepherdson added.

"Net, the Covid hit is nothing like as large as the impact of the crash of 2008. Given the very high saving rate, and the huge stock of savings built up over the past seven months, people have plenty of cash to spend on goods over the holidays, even as the services sector remains in the grip of Covid," he went on to say.

"The confidence data are good enough to suggest that a critical mass of people will have the inclination to go shopping, as well as the wherewithal."