While you were sleeping: Americans grow more confident
Nov. 28 (BusinessDesk) – US consumer confidence rose to a four-year high this month adding to evidence from Thanksgiving weekend retail sales that suggests Americans are shaking off their torpor.
The Conference Board’s confidence index rose to 73.7, beating the estimate in a Bloomberg survey of 73 to reach the highest level since February 2008.
Key to improving sentiment may be perceptions that jobs will be easier to find over the next six months, a relief in a nation where unemployment is 7.9 percent and where the Congress is running out of time to address the fiscal cliff which threatens to stall the economy.
Those expecting more jobs in the next six months rose to a 21-month-high on 20.3, the survey showed, about double the reading for those who thought there were plenty of jobs now.
Americans felt confident enough to hit the stores in the four days starting on Thanksgiving Day, with retail spending – including online shopping – rising 13 percent to US$59.1 billion, according to the National Retail Federation. In the same period a year ago, sales grew 16 percent.
Remarkably, the Conference Board survey showed those planning to buy a house in the next six months rose to a record 6.9 percent. And in another sign of life returning to the US housing market, property values rose 0.3 percent in September, according to the S&P/Case-Shiller 20-city composite index, after a 0.8 percent gain in August. Values rose 3 percent from September 2011.
In other figures, orders for durable goods were little changed in October and some manufacturers noted increased demand, according to the US Commerce Department. Economists had expected a decline.
Stocks on Wall Street registered a tepid response, paring earlier gains, but with investors eyes fixed firmly on Washington and the start of talks to bridge differences on the fiscal cliff of some US$600 billion in tax hikes and spending cuts set to kick in on Jan. 1
A CNN poll shows two-thirds of Americans surveyed fear the country will face severe economic difficulties if politicians in Washington can’t resolve their differences in time.
The greenback rose against most major currencies and the euro weakened from a one-month high after initially gaining on the decision of European finance ministers and the International Monetary Fund to rein in Greece’s debt.
Agreement to free up the next 34.4 billion euro installment of financial aid for Greece still needs sign off from Germany, Finland and the Netherlands next month and there are still plenty of hurdles on which the region can stumble.
“I’m a natural seller on euro here because giving Greece more money is not the solution to any problem -- it’s a band-aid at this stage,” Fabian Eliasson, head of U.S. currency sales at Mizuho Financial, told Bloomberg. “The market went fairly long euro before this so any kind of rattling news that something will jeopardize the deal, or further demands, is going to have a negative effect.”
Germany’s DAX 30 climbed 0.6 percent.
France’s CAC 40 was up just 0.03 percent after government figures showed French jobless claims rose by 1.5 percent, or 45,400, to 3.103 million, a 14-year high and a reminder that Europe’s slump runs deeper than just heavily indebted Greece.