Greg Gerber posted on August 07, 2008 09:10
NEW YORK -- The RBC Cash Index rose in August breaking a three month streak of consecutive declines.
The index increased to 33.8 from 14.6 in July putting it just below where it stood in May of this year. While three of the four sub-indices improved, the “jobs” category, posted a fall.
The forward-looking expectations index posted the biggest gain, rising to -4.7, from the prior month’s -54.7 reading, its highest level this year. This marks the biggest one month rise in the series. The current conditions index rose over six points to reach 36.7.
Investment rose 6.5 points to 42.6 suggesting an increased willingness of households to make major purchases. The jobs index resumed its downward trend suggesting the prior month’s slight rise was likely an anomaly. The jobs index is now at 85.8 versus the 124.5 reading one year ago.
"American consumers appear to be responding to falling oil prices, which are down 20 percent from their peak, a recovering stock market and the income boost provided by tax rebate checks," said Paul Ferley, assistant chief economist at RBC Economic Research. "The rise in the expectations index provides a particularly bright spot, as many consumers make decisions on a forward-looking basis. That said, Americans remain keenly aware that tightening credit conditions, falling home prices and the associated financial turmoil will continue to exert a negative impact on the job market."
SOURCE: RBC Economic Research press release