Several newly released surveys have provided some much-needed cheer for the US economy, suggesting a bounce-back in the confidence of Americans and the beleaguered manufacturing sector.
The closely watched Consumer Confidence Index of business research group The Conference Board made a dramatic recovery in December, surging from 84.9 in November to 93.7 (1985=100).
The results suggest the mood of Americans is picking up faster than anticipated in the wake of September 11. Said Lynn Franco, director of the Board’s Consumer Research Center: “The deterioration in current economic conditions appears to be reaching a plateau, led by a stabilizing employment scenario.
“Consumers’ short-term optimism is no longer at recession levels, and the upward trend signals that the economy may be close to bottoming out and that a rebound by mid-2002 is likely.”
The Conference Board’s Expectations Index saw major gains, leaping from 77.3 to 91.5, while the Present Situation Index edged up from 96.2 to 96.9.
Backing up such results, a separate poll from Washington Post/ABC concluded that 80% of US adults are optimistic about the next twelve months, while yet another survey – undertaken by International Communications Research of Media for the Associated Press – found a majority of Americans anticipates some sort of recovery in the near future.
Meanwhile, December also witnessed an unexpected leap in new manufacturing orders, according to the Institute for Supply Management (formerly the National Association of Purchasing Management).
The ISM’s headline index of manufacturing activity jumped from November’s 44.5 to 48.2 – still below the 50 no-change threshold but ahead of expectations and strong enough to prompt predictions of recovery. Particularly encouraging was the index of new orders, which surged to 54.9, the highest reading since April 2000.
News sources: The Conference Board website; AdAge.com; The Times (London)