Economic Snapshot: Consumer confidence remains at 15-year high

After declining in January, the Consumer Confidence Index rose in February and remains at its highest level since mid-2001.

Consumer confidence

Consumer confidence increased to 114.8 in February, up from 111.6 in January. The Present Situation Index rose from 130.0 to 133.4 and the Expectations Index increased from 99.3 to 102.4.

“Consumer confidence increased in February and remains at a 15-year high (July 2001, 116.3),” said Lynn Franco, director of economic indicators at The Conference Board. “Consumers rated current business and labor market conditions more favorably this month than in January. Expectations improved regarding the short-term outlook for business, and to a lesser degree jobs and income prospects. Overall, consumers expect the economy to continue expanding in the months ahead.”

Consumers saying business conditions are “good” declined slightly from 29.0 percent to 28.7 percent; however, those saying business conditions are “bad” also decreased from 15.9 percent to 13.2 percent. Those stating jobs are “plentiful” declined from 27.1 percent to 26.2 percent; however, those stating jobs are “hard to get” also decreased from 21.1 percent to 20.3 percent.

The percentage of consumers expecting business conditions to improve over the next six months increased from 22.9 percent to 24.0 percent; however, those expecting business conditions to worsen also rose slightly from 10.8 percent to 11.1 percent.

The proportion of consumers expecting more jobs in the months ahead increased from 19.7 percent to 20.4 percent and those anticipating fewer jobs declined from 14.4 percent to 13.6 percent. The percentage of consumers expecting their incomes to increase rose marginally from 18.1 percent to 18.3 percent and the proportion expecting a decrease declined from 9.4 percent to 8.2 percent.

New home sales

Sales of new single-family houses were at a seasonally adjusted annual rate of 555,000 in January, according to estimates released jointly by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 3.7 percent above the revised December rate of 535,000 and 5.5 percent above the January 2016 estimate of 526,000.

The median sales price of new houses sold in January 2017 was $312,900 and the average sales price was $360,900.

The seasonally adjusted estimate of new houses for sale at the end of January was 265,000. This represents a supply of 5.7 months at the current sales rate.

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