Consumer confidence soared to a five-month high in January, according to the Conference Board’s Consumer Confidence Index.
The index rose to 131.6 in January, the Conference Board said Tuesday. That is well-above the 127.8 expected. December was revised up to 128.2 from the earlier reported 126.5.
Confidence is high enough to prevent the economy from slowing down in the first half of 2020, the Conference Board said.
“Consumer confidence increased in January, following a moderate advance in December, driven primarily by a more positive assessment of the current job market and increased optimism about future job prospects,” said Lynn Franco, Senior Director of Economic Indicators at the Conference Board. “Optimism about the labor market should continue to support confidence in the short-term and, as a result, consumers will continue driving growth and prevent the economy from slowing in early 2020.”
Consumers’ views of their present situation improved in January. Those claiming business conditions are “good” increased from 39.0 percent to 40.8 percent, while those claiming business conditions are “bad” fell from 11.0 percent to 10.4 percent. Those saying jobs are “plentiful” rose to 49.0 percent, while those saying jobs are “hard to get” fell from 13 percent to 11.6 percent.
Consumers were also more optimistic about the short-term outlook in January. The percentage of consumers expecting business conditions will improve over the next six months was virtually unchanged at 18.8 percent, while those expecting business conditions will worsen declined from 8.8 percent to 8.4 percent. The share expecting more jobs in the months ahead rose from 15.5 percent to 17.2 percent, while those anticipating fewer jobs declined from 13.9 percent to 13.4 percent.