U.S. consumer confidence stabilizes after September low, according to RBC CASH Index

    NEW YORK, Oct. 5 /CNW/ - Consumer confidence levels improved considerably
in October after tumbling to a 16-month low in September, according to the
most recent results of the RBC CASH (Consumer Attitudes and Spending by
Household) Index, which measured the attitudes of 1,005 Americans earlier this
week. Consumer sentiment stabilized across all surveyed areas, with the
biggest increases occurring in the areas of economic expectations and current
conditions. However, this improvement was driven not by significant increases
in consumer optimism, but rather a leveling out of pessimism. As a result, the
RBC CASH Index for October 2007 stands at 80.6, up more than nine points from
its 71.1 level in September.
    "After collapsing in September, the RBC CASH Index rebounded in October,
with consumers becoming more positive in the wake of the Fed's rate cut and
the calming of the financial markets," said T. J. Marta, Economic and Fixed
Income Strategist for RBC Capital Markets. "However, the lack of a complete
recovery in the Index shows that August's credit crisis has had a profound
affect on consumers' psyches, making them view the financial landscape
    The RBC CASH Index is a monthly national survey of consumer attitudes on
the current and future state of local economies, personal finance situations,
savings and confidence to make large investments. The Index is composed of
four sub-indices: RBC Current Conditions Index; RBC Expectations Index; RBC
Investment Index; and, RBC Jobs Index. The Index is benchmarked to a baseline
of 100 assigned at its introduction in January 2002. This month's findings are
based on a representative nationwide sample of 1,005 U.S. adults polled from
October 1-3, 2007 by survey-based research company Ipsos Public Affairs. The
margin of error was plus or minus 3.1 per cent. Highlights of the survey
results include:

    -   Americans' economic expectations increased significantly this month,
        reversing the free-fall observed in September. The RBC Expectations
        Index for October rose 11 points to 25.7, compared to 14.4 last
        month. Job loss expectations were the driving force behind the
        improvement, as 55 per cent of consumers reported it is unlikely they
        or someone they know will lose their job in the next six months, up
        from 49 per cent in September. While expectations for personal
        finances basically held steady in October, negative expectations for
        respondents' local economy leveled off, with only 20 per cent
        reporting that the economy will be weaker, compared to 23 per cent in

    -   The RBC Current Conditions Index increased more than 10 points,
        reaching 101.1 in October, compared to 90.5 last month. Americans'
        current perception of their local economy is the main driver behind
        the improvement as significantly fewer consumers currently have a
        pessimistic assessment of their local economy. Only one-quarter
        (26 per cent) of Americans rate their local economy as weak, compared
        to just under one-third (31 per cent) who felt similarly in

    -   Consumers' views of the investment climate also showed improvement
        this month. The RBC Investment Index for October increased four
        points to 92.5, after dropping almost 10 points in September to 88.3.
        Consumer comfort levels for future investments edged up this month,
        with 41 per cent of consumers reporting they are more confident in
        their ability to invest in the future, compared to 37 per cent in
        September. Additionally, the percentage of Americans reporting they
        are less confident in investing declined slightly, from 44 per cent
        in September to 41 per cent now.

    -   Americans' perception of job security rose nearly nine points this
        month, and as a result, the RBC Jobs Index for October stands at
        122.5, compared to September's 113.6 level, which had been the lowest
        level for 2007. Forty-one per cent of Americans reported feeling less
        confident about their job security, down four points from last month.
        Personal job loss experience held steady in October, with 31 per cent
        of consumers reporting job loss in their immediate circle compared to
        33 per cent last month.

    The entire RBC CASH Index report can be viewed at:

For further information:

For further information: Loretta A. Healy, The Hubbell Group, Inc.,
(781) 878-8882; Kevin Foster, RBC Capital Markets, (212) 428-6902

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