Consumer confidence improved slightly in August despite concern about business and labor conditions, a business research group reported.
The Conference Board’s Consumer Confidence Index edged up to 53.5, close to the 54.5 reading of August 2009, from 51 in July. A reading above 50 indicates a positive view. A healthy economy typically requires an index of at least 90.
The consumer confidence index is closely watched because consumer spending accounts for 70 percent of U.S. economic activity and is a primary driver of import and domestic freight volumes.
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The index’s present situation component, which measures current concerns about the business and labor markets declined to 24.9 from 26.4 in July. The expectations index, indicating concerns about future conditions, rose to 72.5 from 67.5 last month.
"Consumer confidence posted a modest gain in August, the result of an improvement in consumers' short-term outlook,” said Lynn Franco, director of the Conference Board’s Consumer Research Center. “Consumers' assessment of current conditions, however, was less favorable as employment concerns continue to weigh heavily on consumers' attitudes. Expectations about future business and labor market conditions have brightened somewhat, but overall, consumers remain apprehensive about the future. All in all, consumers are about as confident today as they were a year ago.”
The Consumer Confidence Survey is based on a representative sample of 5,000 U.S. households.
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