Bloomberg News
NEW YORK - Consumer confidence in the economy rose in September as optimism about jobs boosted the outlook for the rest of the year.
The Conference Board's index of consumer confidence increased to 141.9 this month from 140.8 in August. The September reading was just a few points shy of the record 144.7 set in January and matched in May.
Unemployment of 4.1%, close to a 30-year low, and rising incomes have sustained optimism, which should help prolong the economy's record nine-year expansion, analysts said.
"Nothing in this latest survey suggests the economy will run out of steam soon," said Lynn Franco, a Conference Board economist.
Still, consumers may be scaling back spending plans, the report suggested. The share of survey participants expecting to buy new homes, cars, and major appliances all fell in September.
Oil prices close to a 10-year high have pushed up the cost of gasoline and heating oil. That leaves less money for consumers to spend elsewhere, cutting into the profits of many companies, such as Eastman Kodak Co.
The world's biggest photography company warned today third-quarter earnings would fall short of forecasts because of lower-than-expected sales of film and digital products in September. Slowing industry sales gains have also hurt shares of K mart Corp., which is feeling the heat from rivals Wal-Mart Stores Inc. and Target Corp.
The price of gasoline was as high as $1.599 a gallon this month, up 22% since the start of the year. Home heating oil prices are up 37% so far this year.
"The oil price run-up will start to hurt confidence a bit if it continues," said Ethan Harris, senior economist at Lehman Brothers Holdings Inc. in New York, before the report. "Once people start seeing home heating oil bills, that could do it."
The survey of 5,000 households by the New York research group found the share of consumers expecting more jobs to become available rose to 17.9% in September from 17.1% in August. The share that saw jobs as hard to get dropped to 10.7% from 11.5%.
"Until this rises - which means until the unemployment rate rises - confidence will remain strong," said Ian Shepherdson, chief U.S. economist at High Frequency Economics Ltd. in Valhalla, N. Y.
The Conference Board's index that tracks consumers' assessment of present conditions increased to 182.9 in September from 181.3. The index gauging consumer expectations for the next six months also rose, to 114.7 from 113.9 in August.
