US consumer confidence beats in August

US consumer confidence has risen from 81 (revised up from 80.3) to 81.5 in August. Economists had forecast a flat reading at that unrevised figure of 80.3.

The Richmond Fed manufacturing index was also strong in August, rising from -11 to 14.

Amna Asaf, economist, Capital Economics:

We suspect that the slide in gasoline prices may have supported sentiment. In addition, the cut-off date for the survey was August 15th, so prior to the more recent declines in stock markets. The expectations index, which mirrors movements in gasoline and equity prices, rebounded to 88.7, from 86.0.

More surprising was the drop back in the current conditions index to 70.7, from 73.6. This index normally reflects conditions in the labour market which, according to the low level of initial jobless claims, have been improving gradually. Nonetheless, the decline in the balance between those saying jobs are hard to find and those saying jobs are plentiful dropped to a five-year low of 21.6, from 22.9, and suggests that the unemployment rate may fall further from July's 7.4% in the coming months.

Overall, an encouraging report, given that the other measures of sentiment have been weak. At this level, the confidence index points to third-quarter consumption growth of close to 3.0% annualised.