Consumer confidence slipped in two key November surveys and home resales fell in October. New-home sales rose for the same month, but the increase missed economists’ expectations.
The data are hardly a confidence booster for industries such as recreational marine, but boating’s moderate and consistent rebound from the lows of the Great Recession has continued this year despite some unsteadiness in the general economy.
Through October, Statistical Surveys says, boat sales are up 6 percent in the industry’s main powerboat segments and 6.8 percent industrywide in early-reporting states that represent about 63 percent of the market.
That suggests the consumers to whom boating appeals are somewhat less affected by the worries about the job market that dragged down The Conference Board’s Consumer Confidence Index. The index fell nearly nine points to 90.4, from 99.1 in October, which Bloomberg said was the lowest level in more than a year.
Additionally, the University of Michigan’s final Consumer Sentiment Index for November fell to 91.3 from 93.1 in the middle of the month.
The Wall Street Journal said consumer sentiment, as the University of Michigan index measures it, remains near the six-month average of 91.6, but Americans’ spending habits have not matched that mood level. After more than a year of low gasoline prices and steady job creation, many areas of the retail market remain lackluster. Wages have not risen much, and the costs of housing and medical care are increasing.
“The data indicate that consumers have become increasingly aware of economic cross-currents in the domestic as well as the global economy,” Richard Curtin, chief economist of the university’s Surveys of Consumers, said in a statement.
The housing market has not given economists cause for optimism. Existing-home sales fell more than expected in October, dropping 3.4 percent to an annual rate of 5.36 million. Economists had predicted that home resales would fall to a rate of 5.40 million.
CNBC reported that housing is being supported by a strengthening labor market, which is boosting the formation of households by encouraging young adults to leave their parents’ homes. However, the market is constrained by a persistent shortage of homes for sale, which has driven prices up and kept first-time buyers on the sidelines.
New-home sales rose 10.7 percent in October to an annual pace of 495,000, but MarketWatch reported that the underlying trend is flat.
Despite the big monthly jump in October, sales were up only 4.9 percent from the same month last year. As in the home resale market, higher prices have dogged new-home sales and thinned the ranks of first-time buyers.
The monthly report on auto sales is due out today, and the forecast for November is for an annualized sales pace of 17.9 million, down from 18.1 million in October.
On Friday the Labor Department will deliver its monthly jobs report. The consensus forecast is also for weaker growth than in October — 200,000 new jobs, down from 271,000 the previous month — and for a jobless rate that would remain at 5 percent.
Less than two weeks later, on Dec. 15-16, the Federal Reserve Board’s Open Market Committee will meet amid continuing expectations for a rate increase. Fed chairman Janet Yellen will address the Economic Club of Washington on Wednesday and she testifies before the congressional Joint Economic Committee on Thursday.
Barclays’ chief U.S. economist, Michael Gapen, told CNBC that job gains would have to be very low for the Fed to decide against a rate increase at its upcoming meeting.
"I doubt we're going to see a [jobs] number that was as strong as last month, but you need a number like 50,000 or 75,000 for the Fed not to go in December. There's a low bar for this report to clear," Gapen said.