US consumer confidence climbs to four-year high in November

Ben Southwood
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US CONSUMER confidence hit a four and a half year high yesterday, as a swathe of other data added to the picture of an economy recovering modestly.

The Conference Board’s consumer confidence index grew to 73.7 in November, from 73.1 in October, where 100 is the average for 1985. The last time it was higher was when it reached 76.4 in February 2008.

“This month’s moderate improvement was the result of an uptick in expectations,” said Lynn Franco at the Conference Board, “while consumers’ assessment of present-day conditions continues to hold steady.”

This came as two house price indices pointed to further recovery in the housing market. House prices grew 3.6 per cent in the year to September 2012, according to the most recent version of the Standard & Poor’s Case-Shiller home price index, out yesterday.

And houses bought with Fannie Mae or Freddie Mac mortgages were four per cent more expensive in the third quarter, compared to the same period a year earlier, the Federal Housing Finance Agency (FHFA) said yesterday. But FHFA economist Andrew Leventis warned that “stagnant income growth, high unemployment levels, lingering uncertainty about the macroeconomy, and the large number of homes in the foreclosure pipeline” would keep a lid on prices.

Data on durable goods from the US Census Bureau, also released yesterday, was less positive but still contained nuggets of optimism. While shipments of manufactured goods crept down 0.6 per cent, inventories, unfilled orders, new orders and new orders for capital goods all increased, consolidating the thoroughly upward trend in the sector.