Contact us by phone: 561 450-8258. Contact us by email.

Consumer confidence rises in Florida

By Palm Beach Business.com

DELRAY BEACH — Consumer confidence rose modestly in July in both Florida and the nation according to separate reports released Tuesday.

The University of Florida reported  its consumer confidence index for the Sunshine State rose 2 points to a reading of 68; the Conference Board’s consumer confidence index rose 1.9 points to a reading of 59.5.  While consumer felt less confident about the current economy, they’re outlook for the future was more optimistic.

“The increase in the index for July was 1.6 points which was rounded to two,” said Chris McCarty, director of the UF survey.  “This does not represent a big change.  Most of the increase can be attributed to an increase in optimism about whether it is a good time to buy.  This component is now back to the level it was last fall.  Some of this may have to do with declines in gas prices during the month of June and much of July.  This leaves more money in people’s budget for other purchases.”

“Overall, consumers remain apprehensive about the future, but some of the concern expressed last month has abated,”  said Lynn Franco, director of the Conference Board Consumer Research Center.

McCarty said the housing market, which has been in turmoil for the past five or six years, and the outcome of the debt ceiling/deficit reduction talks are the two factors most likely to affect the direction of consumer confidence in the near term.

The Federal Housing Administration is lowering the maximum loan that can be considered conforming, which could make it more expensive to buy — and more difficult to sell — higher-priced homes along the coast.  The deb/deficit negotiations also affect confidence, depending on what gets cut.

“It is unlikely that the U.S. will actually default,” McCarty said.  “The question is what sort of deal will ultimately lead to raising the debt ceiling.  That seems to be anybody’s guess.  Depending on the details this could have a relatively negligible effect on consumers or a severe effect.  It is unlikely that any deficit reduction plan will raise consumer optimism, despite its necessity.”