WASHINGTON (AP) -- The private Conference Board reports on U.S. consumer confidence in November. The report will be released at 10 a.m. Eastern Tuesday.
SMALL REBOUND: Economists forecast that the consumer confidence index rose to a reading of 73 this month, according to a survey by FactSet. That would be up from 71.2 in October and a modest rebound from October's 9-point plunge.
Consumers' confidence is closely watched because consumer spending accounts for 70 percent of economic activity.
SHUTDOWN HIT CONFIDENCE: The 16-day partial government shutdown hammered consumers' confidence last month, pushing it to its lowest level since April.
The drop came just a few months after confidence reached a 5-year high of 82.1 in June, following steady job gains and a pickup in economic growth. That's still below the reading of 90 that is consistent with a healthy economy.
SLOW REBOUND: Lower gas prices and a recent pickup in job gains could help restore consumers' optimism.
Employers added an average of 202,000 jobs from August through October, up from just 146,000 in the previous three months.
And lower gas prices have put more money in consumers' pockets. Prices fell for nine straight weeks to the lowest level in nearly two years before moving up slightly in the past two week. The average price for a gallon of gas nationwide Monday was $3.28.
Falling confidence can cause Americans to spend less. That slows the economic growth, although the relationship between confidence and spending isn't automatic. It can take time for lower confidence to show up in the spending figures. And consumers sometimes keep spending even when they say they feel less confident.
That's what happened last month. Despite the sharp fall in confidence, consumer spent 0.4 percent more at retail stores and restaurants than in September.
Strong auto sales accounted for about half the gain. Restaurants also reported a healthy increase in spending. But Americans also spent more on furniture, electronics and clothing. There were some signs of caution: sales at grocery stores were flat and department stores reported only slightly higher sales.
Still, growth is expected to slow in the current October-December quarter, partly because consumer spending growth is likely to be moderate. The economy expanded at a 2.8 percent annual rate in the July-September quarter, but most economists expect it will slow to about a 2 percent rate or lower in the fourth quarter.
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