CB Consumer Confidence Index
A measure of U.S. consumer sentiment about the economy published by The Conference Board
What is the CB Consumer Confidence Index?
One-line definition: The CB Consumer Confidence Index (Conference Board Consumer Confidence Index) is a well-known consumer sentiment indicator that puts a number on "how U.S. consumers feel about the current economy and job market, and how they expect the next 6 months to look."
It is created by Conference Board, a U.S. economic research organization, based on a mail survey of about 3,000 households every month. Along with the University of Michigan Consumer Sentiment Index, it is one of the two major U.S. consumer sentiment indicators, but the CB Consumer Confidence Index has a sample size that is about 6 times larger, and is especially known for better reflecting how people feel about the job market.
Why consumer confidence matters is simple. About 70% of U.S. GDP comes from consumer spending. When consumers feel "the economy is doing well and jobs are plentiful," they confidently make big purchases like cars and home appliances. On the other hand, when they feel "a recession is coming," they cut back on spending. The CB Consumer Confidence Index is like a thermometer that measures the temperature of this consumer sentiment.
The CB index gets particular attention because one of the survey questions, the ratio of "Jobs Plentiful" vs "Jobs Hard to Get", shows a very strong correlation with the actual unemployment rate. That's why many investors use the employment component of the CB index to get an early read on the direction of the job market before the monthly employment report (NFP) is released.
English terms
Consumer Confidence Index (CCI), CB Consumer Confidence, Conference Board Confidence
Korean terms
CB Consumer Confidence Index, Conference Board Consumer Confidence, Consumer Confidence
What does it measure?
The CB Consumer Confidence Index asks consumers 5 questions and combines their answers to create one composite index and two sub-indices.
Present Situation Index
It consists of 2 questions:
(1) Are current business conditions good, normal, or bad?
(2) Are jobs currently plentiful, not so many, or hard to get? (This "Jobs Plentiful vs Hard to Get" ratio is the key!)
Expectations Index
It consists of 3 questions:
(1) 6 months from now, will business conditions be better, the same, or worse?
(2) 6 months from now, will there be more, the same, or fewer jobs?
(3) 6 months from now, will your household income be higher, the same, or lower?
Consumer Confidence Index (Composite)
This is the combined number that brings the Present Situation Index and the Expectations Index together. The base point is 1985 = 100. When you hear "CB Consumer Confidence XX" in the news, it refers to this composite index.
Labor Market Differential:
The most-watched sub-component of the CB survey is the Labor Market Differential, which is the percentage of respondents who say "Jobs Plentiful" minus the percentage who say "Jobs Hard to Get".
For example, if 40% of respondents say "jobs are plentiful" and 15% say "jobs are hard to get," the differential is +25%.
This differential shows a surprisingly strong negative correlation with the unemployment rate. Whenever the differential falls, the unemployment rate has tended to rise 2 to 4 months later. That's why Wall Street uses this number as "a preview of the NFP."
Key distinctions: everything you need to know
To properly interpret the CB Consumer Confidence Index, you need to understand a few key distinctions.
1. CB vs University of Michigan: how are they different?
CB Consumer Confidence Index
Sample: about 3,000 households (mail survey)
Focus: Feelings about the job market
Base: 1985 = 100
Release: Last Tuesday of every month
University of Michigan Consumer Sentiment Index
Sample: about 500 people (phone survey)
Focus: Feelings about inflation + financial situation
Base: 1966 = 100
Release: 2nd/4th Friday of every month
Key difference: The University of Michigan index releases its preliminary reading during the second week of the month, so it comes out earlier than the CB. However, the CB has a 6 times larger sample and more direct questions about the job market, which makes CB more useful for forecasting employment indicators (NFP). When the two indices move in the same direction, confidence in the signal is high. When they diverge, you need to dig into which factor (inflation vs employment) is having a bigger impact on consumer sentiment.
2. Present Situation Index vs Expectations Index
Present Situation Index
This is a coincident indicator. It reflects the current state of the economy and employment. When this number is high, it means consumers feel the economy is doing well right now. It's useful for confirming the current state of the economy along with corporate earnings and employment data.
Expectations Index
This is a leading indicator. It reflects the outlook for business conditions, employment, and income over the next 6 months. It's a more important index for investors. In particular, when it falls below 80, a recession has historically followed in many cases.
3. Expectations Index 80 -- the recession warning line
Expectations Index below 80 = recession warning
According to the Conference Board's own analysis, when the Expectations Index has fallen below 80 and stayed there for more than 3 months, a recession has historically followed in a very high percentage of cases.
Before both the 2001 dot-com bust and the 2008 financial crisis, the Expectations Index dipped below 80. In 2024, the Expectations Index fluctuated around 80, drawing significant market attention. However, there have been cases where the Expectations Index briefly dropped below 80 and quickly recovered without a recession, so you also need to look at how long it stays there.
Why does it matter? -- impact on the market
There are three main reasons why the CB Consumer Confidence Index matters to the market.
First, it acts as a real-time thermometer of the job market. The official employment report (NFP) only comes out once a month and has a data-collection lag, but the CB's "jobs plentiful/hard to get" responses reflect consumers' real-time feel for the job market. When the "jobs plentiful" share starts to decline, hiring tends to weaken in the NFP 1 to 3 months later.
Scenario: CB Consumer Confidence rising
Meaning: Consumers are optimistic about the economy and jobs -> higher consumer spending expected
Stocks: Cyclical stocks such as Consumer Discretionary (XLY) and small caps (Russell 2000) tend to outperform
Bonds: Signals economic expansion -> lower demand for safe-haven assets -> possible decline in Treasury prices (yields rise)
Scenario: CB Consumer Confidence plunging
Meaning: Consumers feel job insecurity and a slowing economy -> concern about a pullback in spending
Stocks: Cyclical stocks fall -> Defensive stocks (Consumer Staples, Health Care, Utilities) relatively outperform
Rates: Worries about economic slowdown -> expectations of Fed rate cuts rise -> Growth stocks may rebound
Second, it is better than the University of Michigan index at predicting the unemployment rate. The University of Michigan index is strong on inflation expectations, while the CB asks more direct questions about jobs, so it predicts unemployment-rate changes better. When the "jobs plentiful" share has fallen from 40% to 30%, the unemployment rate has tended to rise by 0.3 to 0.5 percentage points afterward.
Third, the Expectations Index can flag a recession ahead of time. As mentioned earlier, when the Expectations Index falls below 80 and stays there for 3 months or more, the probability of a recession rises sharply. This signal has appeared an average of 6 to 9 months before NBER's (National Bureau of Economic Research) official recession declaration.
Real-world example (2024~2025): In the first half of 2024, the CB Consumer Confidence Index hovered around 100, staying at a decent level. However, the Expectations Index gradually fell and approached 80, and the "jobs plentiful" share also slowly declined. This was a signal that the job market was still strong but starting to show signs of weakening. In fact, from the second half of 2024, NFP job gains began to slow, which also influenced the Fed's decision to cut rates.
Release schedule and how to check it
Unlike the University of Michigan index, the CB Consumer Confidence Index is released only once a month.
Release timing
Released on the last Tuesday of every month at 10:00 a.m. U.S. Eastern Time. In Korean time, that is 11:00 p.m. during daylight saving time (March to November) and midnight during standard time (November to March).
Issuing organization
Conference Board — a non-profit economic research organization founded in 1916. It also publishes the Leading Economic Index (LEI), Coincident Economic Index (CEI), and Employment Trends Index (ETI), among others.
Consumer-sentiment events cluster at month-end!
Because the University of Michigan final reading (4th-week Friday) and the CB Consumer Confidence (last Tuesday) come out around the same time, consumer-sentiment events pile up at the end of the month. When the two indices move in the same direction, the market reaction is stronger; when they diverge, confusion can result. Investors often revisit their consumer-stocks positions during this period.
Key numbers to check alongside the release:
Composite Confidence Index
Headline -- direction vs prior month
Expectations Index
Check whether it is above or below 80
Jobs Plentiful %
Job-market health -- trend
Labor Market Differential
Plentiful - Hard to Get
How investors can use it
Here are 4 practical strategies for using the CB Consumer Confidence Index in investing.
Strategy 1: Monitor recession risk with the Expectations Index
When the Expectations Index falls below 80, switch into recession-alert mode. At that point, it is safer to increase your weighting in defensive stocks (Consumer Staples, Health Care, Utilities) and to hold more cash. If the index stays comfortably above 80, you can assume the economic expansion is continuing.
Key point: A single dip below 80 is less important than 3 straight months below 80, which is the real warning signal. A brief dip followed by a rebound can even turn into a buying opportunity.
Strategy 2: Use the Labor Market Differential as an NFP preview
Keep an eye on changes in the CB's "jobs plentiful" share. When that share starts trending down, the NFP job gains are likely to slow over the next 1 to 3 months.
Practical tip: The CB release (last Tuesday) usually comes about a week before the NFP release (first-week Friday). If the CB employment read deteriorates sharply, consider adjusting employment-sensitive positions (HR companies, staffing firms, etc.) before the NFP release.
Strategy 3: Analyze the gap between CB and University of Michigan
Divergences between the two indices can be the most interesting investment opportunities. If the University of Michigan index falls (inflation worries) while CB is strong (solid jobs) -> it means wage inflation exists but the economy is still fine. In that case, both inflation beneficiaries (energy, commodities) and consumer stocks can rally together.
Conversely, if the University of Michigan index rises (easing inflation) while CB falls (job-market worries) -> the slowdown signal is clear. In that case, consider rotating into rate-cut beneficiaries (growth stocks, real estate).
Strategy 4: Position across consumer-related sectors
When CB Consumer Confidence is in a steady uptrend, overweight Consumer Discretionary (XLY) ETFs or individual consumer companies. Automobiles (GM, F), home improvement (HD, LOW), leisure (DIS, NCLH), and restaurants (MCD, SBUX) are direct beneficiaries.
When confidence is trending down, rotate into Consumer Staples (XLP). Household essentials (PG, CL), groceries (KR, WMT), and tobacco/beverages (PM, KO) tend to deliver relatively stable earnings even during economic slowdowns.
Related economic indicators
These are indicators that, when checked together with the CB Consumer Confidence Index, give a more accurate read on the economy.
Cross-check with the University of Michigan Consumer Sentiment Index
When the University of Michigan index (inflation-focused) and CB (employment-focused) move in the same direction, you can be confident in the consumer sentiment shift. Make it a habit to check both indices side by side every month.
Relationship with the NFP (Nonfarm Payrolls)
The CB Labor Market Differential (Jobs Plentiful - Hard to Get) is a useful preview of NFP direction. CB comes first (last Tuesday) and NFP comes later (first-week Friday), so the timing works well.
Retail sales and consumer spending
Consumer confidence measures "feelings," while retail sales measure "action." If confidence falls but retail sales stay strong, the real economy is still doing fine. Conversely, if confidence is high but retail sales are weak, that's a warning that confidence could soon roll over.
Frequently Asked Questions (FAQ)
Q. When is the CB Consumer Confidence Index released?
A. It is released on the last Tuesday of every month at 10:00 a.m. U.S. Eastern Time. In Korean time, that is 11:00 p.m. during daylight saving time (March to November) and midnight during standard time (November to March). It is often released in the same week as the University of Michigan final reading (4th-week Friday), so consumer-sentiment data clusters at month-end.
Q. What is a "good" reading for the CB Consumer Confidence Index?
A. The base point is 1985 = 100. A reading above 120 means consumers are very optimistic about the economy (around the 2018~2019 level), and 100~120 is considered solid. 80~100 is neutral, and below 80 is pessimistic. However, for investment decisions, the Expectations Index being above or below 80 is a more meaningful yardstick than the composite index alone.
Q. Why is the "Jobs Plentiful" share so important?
A. The share of respondents who say "jobs are plentiful" directly shows how consumers perceive the health of the job market. When this share falls, it is a leading indicator of rising unemployment; when it rises, it signals a solid job market. The Labor Market Differential (the "plentiful" share minus the "hard to get" share) has a correlation of over 0.9 with the unemployment rate, making it one of the best references for gauging the direction of the job market before the NFP release.
Q. When the CB Consumer Confidence and the University of Michigan Consumer Sentiment diverge, which one should I follow?
A. It depends on which factor is driving consumer sentiment at the time. In periods when prices (inflation) are the main issue, the University of Michigan index reacts more sensitively; in periods when employment is the main issue, CB is more accurate. When the two diverge, first ask yourself "Is the market's main concern right now inflation or jobs?" and then put more weight on the index that matches that concern. Over the long term, the two indices tend to converge in the same direction.
Q. Is it okay to trade stocks on the day the CB Consumer Confidence Index is released?
A. The CB Consumer Confidence Index doesn't cause as much market volatility as CPI or NFP. However, when there is a big surprise versus expectations (especially if the Expectations Index breaches 80, or the Jobs Plentiful share moves sharply), volatility can be significant. For beginners, it's safer to watch the market reaction for 30 minutes to an hour after the release before deciding, rather than rushing to trade right away. Also keep in mind that the release time is 10 a.m. (during the trading session), so the reaction shows up in regular hours, not in the pre-market.
Q. If the Expectations Index drops below 80, does a recession always follow?
A. Not always. The key is "how long it stays there." When the Expectations Index briefly dipped below 80 and quickly bounced back (for example, fear caused by a one-off event), there have been cases where a recession didn't follow. However, when it stays below 80 for 3 months or more, the historical probability of a recession rises significantly. So rather than looking at a single month's number, you need to watch the trend and confirm with other indicators (ISM, GDP, employment) as well.