---
title: "Monday Update: Consumer Confidence Improves to End the Year"
description: In his Monday Update, Commonwealth’s Sam Millette highlights consumer confidence, home sales, durable goods orders, and personal income and spending.
image: https://blog.commonwealth.com/hubfs/Rebrand-Blog-Images/IMO-images/Monday-Update/monday-a.jpg
---

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# [Monday Update: Consumer Confidence Improves to End the Year](https://blog.commonwealth.com/independent-market-observer/monday-update-consumer-confidence-improves-to-end-the-year)

Posted by [Sam Millette](https://blog.commonwealth.com/independent-market-observer/author/sam-millette) 

This entry was posted on  Dec 27, 2021, 11:23:18 AM

 and tagged [In the News](https://blog.commonwealth.com/independent-market-observer/topic/in-the-news) 

[Leave a comment](https://blog.commonwealth.com/independent-market-observer/monday-update-consumer-confidence-improves-to-end-the-year#comments-listing)

![In his Monday Update, Commonwealth’s Sam Millette highlights consumer confidence, home sales, durable goods orders, and personal income and spending.](https://blog.commonwealth.com/hs-fs/hubfs/Rebrand-Blog-Images/IMO-images/Monday-Update/monday-a.jpg?width=300&name=monday-a.jpg)Last week saw a number of important economic updates, with a focus on consumer confidence, existing home sales, durable goods orders, and personal income and spending. Consumer confidence improved by more than expected to finish out the year, which is a positive sign for year-end spending reports. There are no major economic data releases scheduled for this week, but we’ll see a number of updates in the first week of the new year.

##### Last Week’s News

On Wednesday, the **Conference Board Consumer Confidence Index** for December was released. This widely followed measure of consumer confidence increased by more than expected. Against forecasts for a result of 111, the index rose from an upwardly revised 111.9 in November to 115.8 in December. This reading was driven by an increase in future expectations to a five-month high, which was partially due to lowered consumer inflation expectations. It’s likely that the declining inflation expectations are due in part to the Fed’s more hawkish language at its December meeting, which indicated that faster monetary policy tightening may be on the way. The solid result for the index in December was especially encouraging given the rising medical risks presented by the Omicron variant toward year-end. Historically, improving consumer confidence has supported faster consumer spending growth. This report bodes well for December’s consumer spending figures, even if confidence remains below the 2021 high of 128.9 recorded in June.

Wednesday also saw the release of the November **existing home sales** report. Existing home sales increased by 1.9 percent during the month, against economist estimates for a 2.9 percent rise. Despite the miss against expectations, this report marks three consecutive months with faster sales growth, bringing existing home sales to their highest level since January. The ongoing economic recovery and relatively low mortgage rates supported faster sales, even though the supply of existing homes for sale remains limited on a historical basis. The lack of supply has been a headwind for the housing industry throughout much of this year, causing prices to surge in some markets. With that said, the continued sales growth is a positive sign that home buyer demand remained strong enough to weather the headwinds. This trend indicates continued growth for the housing sector in November.

On Thursday, the preliminary estimate for the November **durable goods orders** was released. Headline durable goods orders improved by more than expected, rising by 2.5 percent against calls for a more modest 1.8 percent gain. This result was largely driven by an increase in volatile commercial aircraft orders. Core durable goods orders, which strip out the impact of transportation orders, increased by a solid 0.8 percent in November, slightly above economist expectations for a 0.6 percent increase. Core durable goods orders are often viewed as a proxy for business investment, so this strong result was an encouraging sign that businesses continued to spend and invest to try to meet high consumer demand. The November report marks nine straight months with increased core durable orders growth. This trend highlights the continued recovery in business spending seen throughout most of this year.

We finished the week with Thursday’s release of the November **personal spending** and **personal income** reports. Personal spending increased by 0.6 percent during the month, in line with economist estimates. Marking the ninth consecutive month with increased personal spending, this report continues a streak that's impressive streak given the shifting medical and economic risks throughout the year. Personal spending growth has been largely supported by the easing of state and local restrictions throughout much of the year. Recently, however, we’ve started to see some local governments increasing restrictions due to the Omicron variant. With that said, large-scale national shutdowns are not expected at this time. As personal spending growth showed impressive resiliency during the waves of the pandemic earlier this year, continued growth is anticipated. In November, personal income increased by 0.4 percent, in line with economist estimates. Personal income growth has been volatile throughout the pandemic due to shifting federal unemployment and stimulus payments. Notably, this report marks two consecutive months with income growth following the expiration of enhanced unemployment benefits in September. Given the continued labor market recovery and labor shortages in some areas, personal income growth is expected in the months ahead.

##### What to Look Forward To

There are no major economic updates scheduled for release this week.

Thanks for reading and have a happy new year!

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