The market has to be getting more than just confused about what the hell is happening to consumer confidence and consumer sentiment. The Conference Board released its reading on consumer confidence for the month of July, signaling that consumers were slightly more confident. This is in stark contrast to the ghastly consumer sentiment report from the University of Michigan just a week ago. We have argued that the Conference Board’s report is by far a more reliable and accurate report, but the University of Michigan report gets so much attention because it is released a week earlier.
Tuesday’s report from the Conference Board showed that the Consumer Confidence Index increased slightly in August after falling in July. August was at 81.5, versus 81.0 in July. Because of last week’s shoddy sentiment report, expectations were much lower. Bloomberg had the consensus estimate down at 78.0 and the range was at 74.8 to 80.0.
The Conference Board signaled that the Present Situation Index decreased to 70.7 from 73.6. Its Expectations Index rose to 88.7 from 86.0 last month. The cutoff date for the preliminary results was August 15.
If you read through the report, the gain here was really a result of improving short-term expectations. Consumers were moderately more upbeat about business, jobs, income expectations and more. The lagging effect and drag was from a general assessment of current business and labor market conditions being less favorable than a month ago.
Seriously, take a look at how different these reports are. The University of Michigan was a death plunge and these Conference Board results seem more normal. The Conference Board uses Nielsen and is based on approximately 3,000 completed questionnaires, whereas the University of Michigan comes from a few hundred responses.