Consumer Confidence Increases Again in August

Consumer confidence increased strongly in August and the three-month moving average (3MMA) had the largest monthly increase since October last year, according to The Conference Board’s Consumer Confidence Survey. The composite value of consumer confidence in August was 133.4, up from 127.9 in July. The 3MMA increased from 127.9 in July to 129.5 in August, which was 10.2 points higher than in August last year.

Calculating the data as a moving average smooths the monthly volatility, which in the case of consumer confidence has been quite extreme since the beginning of 2016. The composite index is made up of two sub-indexes, the consumer’s view of the present situation and his or her expectations for the future. Both are above their nine-year trend line, though expectations are drifting down (Figure 1).