US consumer confidence falls back : Tuesday, 29 September 2009 19:50 UK

[Watchman]

Page last updated at 18:50 GMT, Tuesday, 29 September 2009 19:50 UK

[COLOR="_______"]US consumer confidence falls back[/COLOR]

Shoppers in Manhattan
US consumers are worried about job prospects

US consumer confidence fell unexpectedly in September, suggesting Americans are not as convinced as US policymakers of an economic recovery.

The closely-watched Consumer Confidence Index from the Conference Board business organisation slipped to 53.1 from a revised 54.5 in August.

Economists were expecting confidence to improve after it rose in August.

Separately, a leading US index has shown a better-than-expected increase in house prices in July.

'Apprehensive'

"Consumers viewed both current business conditions and the labour market less favourably than last month," said Lynn Franco, director of the Conference Board's Research Center.


The housing market does seem to have found a base and prices seem to be in recovery, which is quite significant
David Sloan, economist at 4Cast

"Consumers remain quite apprehensive about the short-term outlook and their incomes. With the holiday season quickly approaching, this is not very encouraging news," he added.

Earlier this month, Federal Reserve Chairman Ben Bernanke said that the US recession was probably over, while President Barack Obama has said the economy is improving.

US consumer confidence is closely watched, as personal spending accounts for about 70% of US economic activity.

An index reading of 90 is the minimum to indicate a healthy economy.

'Prices recovering'

But there was some positive news on US house prices.

The Case-Shiller Home Price index rose by 1.6% from the previous month, although prices remained 13.3% below July 2008 levels.

David Sloan, economist at 4Cast, described the figures as "pretty impressive".

"We were pretty surprised that [prices are] moving ahead so rapidly. The housing market does seem to have found a base and prices seem to be in recovery, which is quite significant," he added.