Consumer Confidence Hits Highest Level Since February 2008
The index of consumer attitudes jumped to 76.2 in May, compared to an upwardly revised 69.0 in April, according to The Conference Board, an industry group. It was the best level for consumer confidence since February 2008. Analysts polled by Reuters expected the index to only reach 71.0 in May.
Lynn Franco, Director of Economic Indicators at The Conference Board, explains, “Consumer Confidence posted another gain this month and is now at a five-year high. Consumers’ assessment of current business and labor-market conditions was more positive, and they were considerably more upbeat about future economic and job prospects. Back-to-back monthly gains suggest that consumer confidence is on the mend and may be regaining the traction it lost due to the fiscal cliff, payroll-tax hike, and sequester.”
Other sentiment gauges provided by The Conference Board also showed improvement. The Present Situation Index increased to 66.7 from 61.0, while the Expectations Index improved to 82.4 from 74.3. The assessment of people claiming business conditions are “good” increased to 18.8 percent in May, compared to 17.5 percent in the prior month. The number of people saying business conditions are “bad” fell to 26.0 percent from 27.6 percent.
Sentiment about the labor market also improved. Those saying jobs are “plentiful” increased to 10.8 percent, compared to 9.7 percent in April. Meanwhile, those saying jobs are “hard to get” edged lower to 36.1 percent from 36.9 percent.
The results echo other consumer confidence readings. According to the most recent Gallup poll, U.S. confidence is hanging near five-year highs made earlier in May. Furthermore, the weekly Bloomberg Consumer Comfort index is near five-year highs, with the personal finance measure climbing higher for six consecutive weeks.
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