Consumer sentiment, as measured by the two major national surveys, improved again in November as the public remained upbeat about the economy after Donald J. Trump was elected to a second, non-consecutive term in the presidency.
The Conference Board reported that its Consumer Confidence Index rose for the second month in a row, climbing to 111.7 in November from an upwardly revised 109.6 in October.
“Consumer confidence continued to improve in November and reached the top of the range that has prevailed over the past two years,” Dana M. Peterson, chief economist at The Conference Board, stated in a press release. “November’s increase was mainly driven by more positive consumer assessments of the present situation, particularly regarding the labor market. Compared to October, consumers were also substantially more optimistic about future job availability, which reached its highest level in almost three years. Meanwhile, consumers’ expectations about future business conditions were unchanged, and they were slightly less positive about future income.”
The member-driven think tank reported that the improvement in November was led by a large increase in confidence among Americans younger than 35.
“The proportion of consumers anticipating a recession over the next 12 months fell further in November and was the lowest since we first asked the question in July 2022,” Peterson added. “Consumers’ assessments of their family’s current financial situation fell slightly, but optimism for their finances over the next six months reached a new high.”
The latter two measures were not included in the calculation of the think tank’s monthly confidence index.
The nonpartisan organization also reported that consumers were more optimistic about the stock market in November, as 56.4% of survey respondents said they expected stock prices to increase in 2025 — a record high for that measure.
In a special question, the organization reported that consumers overwhelmingly chose higher prices as their top concern and lower prices as their top wish for 2025.
A separate measure of public confidence, the University of Michigan’s Consumer Sentiment index, rose for the fourth straight month in November, reaching 71.8, up from 70.5 in October. Sentiment among Republicans surged after Trump’s victory. The measure was at its highest since April.
“Overall, the stability of national sentiment this month obscures discordant partisan patterns,” Joanne Hsu, director of the university’s Surveys of Consumers, stated in a press release. “In a mirror image of November 2020, the expectations index surged for Republicans and fell for Democrats [in November], a reflection of the two groups’ incongruous views of how Trump’s policies will influence the economy.
“In contrast, current conditions saw insignificant changes this month across the political spectrum, consistent with the fact that the resolution of the election exerted little immediate impact on the current state of the economy,” Hsu added. “Ultimately, substantial uncertainty remains over the future implementation of Trump’s economic agenda, and consumers will continue to recalibrate their views in the months ahead.”
Eric Wold, a senior analyst at B. Riley Securities who follows the recreational marine industry, noted in a late November report that he continued to believe the Federal Reserve’s efforts to reduce interest rates “will not only start to move [boat] buyers off the sidelines and reduce elevated channel inventories, but will motivate dealers to take on additional new model year inventory ahead of next year’s boating season.”
“We believe Brunswick is well-positioned to benefit from any demand pivot, given the combination of increased boating activity (parts and accessories sales) and OEMs ramping production (engine and Navico sales),” Wold added. “However, we would also expect higher-end buyers to increase boat purchases on more confidence around the macroeconomic outlook, which should continue to help MarineMax outperform the industry recovery.”
Consumer spending increased slightly more than was expected in October. The U.S. Department of Commerce reported that spending rose by 0.4% after an upwardly revised 0.6% gain in September. Adjusted for inflation, spending was up by 0.1%. Consumers’ income rose by a solid 0.6% in October.
Inflation was flat in October. The Personal Consumption Expenditures Price Index rose by 0.2%, the same as it did the previous month. In the 12-month period through October, the index rose by 2.3%. The Fed is trying to get inflation down to 2%.
The so-called core PCE index, which excludes the volatile food and energy components, rose by 0.3%, a figure that also matched the increase in September. Core PCE inflation was up by 2.8% on a year-over-year basis in October. It had been up by 2.7% the previous month.
“Disinflation through the import channel on goods has driven down inflation over the past two years,” Joe Brusuelas, chief economist at RSM, told Reuters. “But higher goods costs are most likely on the way, and that increase will also result in higher service-sector costs.”
The Conference Board reported that its Leading Economic Index fell again in October, declining by 0.4% to 99.5% after declining by 0.3% in September.
“The largest negative contributor to the LEI’s decline came from manufacturer new orders, which remained weak in 11 out of 14 industries,” Justyna Zabinska-La Monica, senior manager, business cycle indicators, at The Conference Board, stated in a press release.
“In October, manufacturing hours worked fell by the most since December 2023, while unemployment insurance claims rose and building permits declined, partly reflecting the impact of hurricanes in the southeast U.S. Additionally, the negative yield spread continued to weigh on the LEI. Apart from possible temporary impacts of hurricanes, the U.S. LEI continued to suggest challenges to economic activity ahead.”
The mood at the nation’s small businesses improved in October. The National Federation of Independent Business reported that its Small Business Optimism Index rose by 2.2 points, to 93.7.
The result, however, left the index below its historical average of 98 for the 34th month in a row. Inflation remained the main problem for member business owners, as 23% of them called it their most significant issue.
“With the election over, small business owners will begin to feel less uncertain about future business conditions,” Bill Dunkelberg, the NFIB’s chief economist, stated in a press release. “Although optimism is on the rise on Main Street, small business owners are still facing unprecedented economic adversity. Low sales, unfilled jobs openings and ongoing inflationary pressures continue to challenge our Main streets, but owners remain hopeful as they head toward the holiday season.”
A seasonally adjusted 35% of owners reported job openings that they could not fill. A net 31% of owners, also seasonally adjusted, reported raising pay during the month.
Confidence among the nation’s home builders improved in November for the third month in a row. The National Association of Home Builders reported that its NAHB/Wells Fargo Housing Market Index climbed to 46, up from 43 in October.
“With the elections now in the rearview mirror, builders are expressing increasing confidence that Republicans gaining all the levers of power in Washington will result in significant regulatory relief for the industry that will lead to the construction of more homes and apartments,” NAHB chairman Carl Harris, a custom home builder from Wichita, Kan., stated in a press release. “This is reflected in a huge jump in builder sales expectations over the next six months.”
NAHB chief economist Robert Dietz added: “While builder confidence is improving, the industry still faces many headwinds, such as an ongoing shortage of labor and buildable lots, along with elevated building material prices. Moreover, while the stock market cheered the election result, the bond market has concerns, as indicated by a rise for long-term interest rates. There is also policy uncertainty in front of the business sector and housing market as the executive branch changes hands.”
All three HMI component indexes were higher in November. The index that charts current sales conditions rose by 2 points, to 49; the component that measures sales expectations in the next six months increased by 7 points, to 64; and the gauge that charts the traffic of prospective buyers rose by 3 points, to 32.
Any number above 50 indicates that more builders view conditions as good rather than poor.
The Commerce Department reported that sales of new homes fell by double digits in October, the last month before the presidential election. The government reported that sales were lower by 17.3%, at a seasonally adjusted annual rate of 610,000.
“The decline in new-home sales highlights the pressures on prospective buyers, who are navigating tighter budgets and higher borrowing costs,” Harris stated. “The drop also reflects a slowdown in buyer activity amid broader economic uncertainty.”
Danushka Nanayakkara-Skillington, the NAHB’s assistant vice president for forecasting and analysis, added: “Higher mortgage rates, up 60 basis points in October per Freddie Mac, and elevated home prices continued to worsen affordability challenges. Despite these headwinds, which also include increased material costs for builders, new construction remains a vital part of the market, especially in areas with low existing-home inventory.”
The median new-home sales price in October was $437,300, up 4.7% from the same month a year earlier.
Existing-home sales were higher in October. The National Association of Realtors reported that sales rose by 3.4%, to a seasonally adjusted annual rate of 3.96 million.
“The worst of the downturn in home sales could be over, with increasing inventory leading to more transactions,” NAR chief economist Lawrence Yun stated in a press release. “Additional job gains and continued economic growth appear assured, resulting in growing housing demand. However, for most first-time home buyers, mortgage financing is critically important. While mortgage rates remain elevated, they are expected to stabilize.”
The NAR reported that the total housing inventory registered at the end of October was 1.37 million, up 0.7% from September and up 19.1% from the same month a year earlier.
Unsold inventory in October was at a 4.2-month supply at the current sales pace. That was down from a 4.3-month supply in September.
The median existing-home sales price was $407,200 in October, up 4% from the same month a year earlier.
“The ongoing price gains mean increasing wealth for homeowners nationwide,” Yun added. “Additional inventory and more home-building activity will help price increases moderate [in 2025].”
