WASHINGTON (AP) — Americans’ confidence in the economy rebounded somewhat in October as gas prices fell slightly, although it remains much more expensive refuel than last year at this time.
The Conference Board said Tuesday that its consumer confidence index rose 7.5 points to 91.7 in October from 84.2 last month. The September figure was the lowest in the council’s survey since April 2014 and below the lowest level reached during the pandemic.
Yet the Americans stay angry by the economy after five years of high inflation, potentially presenting a risk to President Donald Trump and Republicans in next Tuesday’s midterm elections.
Respondents’ views on their current situation rose 6.9 points to 72.6 while their short-term outlook rose 8.6 points to 120.4.
“The recovery was consistent with the decline in retail gasoline prices from September to October,” said Fergus McCormick, senior economist at the Conference Board. “Yet despite October’s increase, consumer confidence remained on the long-term downward trend that has persisted over the past several years.”
According to the AAA auto club, the average price of a gallon of regular gasoline in the United States was $4.27 on Tuesday, up from $4.48 a month ago. This time last year, a gallon of regular water in the United States cost an average of $3.05.
Written responses to the council’s survey, collected between October 1 and 21, were still largely pessimistic this month, with frequent references to the high cost of energy, goods and services.
Trump continued to blame his predecessor, Democrat Joe Biden, for high prices, but inflation has increased since Trump’s inauguration last year.
Earlier this month, the government announced that consumer inflation has accelerated in September, as goods and services became more expensive, evidence that rising prices remain an economic challenge just seven days before the midterm elections that took place. heavily focused on affordability.
The consumer price index rose 3.7% in September from a year ago, according to the Labor Department, up from 3.4% in August. On a monthly basis, costs jumped 0.6% from August to September, the largest increase in five months.
Six weeks ago, the Federal Reserve raised its benchmark interest rate for the first time since 2023 in an effort to curb this stubbornly high inflation, and the central bank signaled that another rate hike could come later this year, although few expect it. this week’s Fed meeting.
The quarter-point increase brought the Fed’s benchmark rate to around 3.9% and, ultimately, could lead to higher borrowing costs for mortgages, auto loans and credit cards.
The most recent measure of the Federal Reserve’s preferred inflation gauge – the Personal Consumption Expenditures Price Index, or PCE – rose 3.4% in August a year earlier. That’s slightly better than the 3.7% year-over-year increase recorded in July, but up from 2.8% before the start of the war in Iran on February 28. It was 2.5% when Trump was inaugurated in January 2025.
The government releases its September PCE data on Thursday.
The view of the current labor market has improved since September, even if the employment landscape has not.
The percentage of respondents who said jobs were “plenty” increased from 24.3% in September to 26.7% this month. The percentage of those who believe a job is “hard to get” remained at 21.4%.
American employers added a disappointing 29,000 jobs last month and the unemployment rate rose to 4.2%. Economists had expected the September workforce to be around 90,000 people.
Hiring fell from the downwardly revised 133,000 in August and the Labor Department’s revisions also removed 60,000 jobs from the combined July and August payrolls.
Inflation has dominated discussions this year in businesses and households and meager wage increases have made rising prices more painful for many. The average hourly wage is not keeping pace with inflation, increasing just 3% last month from a year earlier, the smallest year-over-year increase since May 2021.
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