Industry News

Consumer confidence improves in October

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Consumer confidence recorded its eighth-largest monthly gain in the October 2006 survey from the University of Michigan as consumers looked more positively on the pace of economic growth. "Declines in gas prices sparked the initial gains in late August, but the more substantial October gains were driven by the expectation of an improved pace of economic growth, larger wage gains and a low unemployment rate during the year ahead," according to Richard Curtin, the director of the University of Michigan's Survey of Consumers. Not all aspects of future economic prospects were positive. Although inflation has improved due to declines in gas prices, consumers remain concerned that an elevated inflation rate will persist during the year ahead, and consumers widely anticipate additional hikes in interest rates next year. "Despite a continued downturn in housing during 2007, the data indicate a 3 1/4 percent growth rate in personal consumption spending during the year ahead," noted Curtin. ...