With gasoline and oil prices soaring, hiring tepid, stock markets slipping and violence worsening in Iraq, there aren't many reasons for U.S. consumers to express cheer these days. In a poll of economists, the Conference Board's monthly index of consumer confidence is expected to slide to 94.0 in October -- a five-month low -- from 96.8 the prior month. The data will be released on Tuesday at 10 a.m. EDT (1400 GMT). Other gauges of consumer attitudes have shown even more weakness, with all the bad news filling the airwaves coupled with a heated presidential campaign. The University of Michigan's preliminary October index surprisingly plunged to 87.5 from 94.2.
Consumer confidence gauges are usually viewed for hints on the outlook for spending, which drives two-thirds of the U.S. economy. Households have consistently kept shopping for cars and homes despite expressing worries on the economy. Yet some economists are questioning how much more consumers will be able to shoulder the economic burden. The first snapshot of third-quarter growth is forecast in a poll to show a hearty 4.2 percent annual pace. But that has not been enough to generate significant new jobs. During the third quarter, non-farm payrolls rose by just 309,000 -- not enough to keep up with the natural growth of the labor market. Without stronger hiring boosting incomes and spending, economic growth could stagnate -- especially in the face of steep energy costs. "Early indications of activity in the fourth quarter seem less upbeat," economists at Lehman Brothers said in a recent note to clients.///