Are Americans Feeling Better About Their Economic Prospects?
Despite a sluggish economy and an overall weak labor market, Americans found a way to be optimistic about the future, as consumer confidence rose to its highest level in more than six years.
The Conference Board’s Consumer Confidence Index jumped 5 percentage points to 82.3 in March compared to 78.3 in February. It was the highest reading since January 2008. Economists only expected the index to come in around 78.6. The lowest point for the index last year was 58 in January, while the highest point was reached in June, at 82.1. During the Great Recession, the index averaged a dismal 54.
“Consumer confidence improved in March, as expectations for the short-term outlook bounced back from February’s decline,” said Lynn Franco, director of Economic Indicators at The Conference Board. “While consumers were moderately more upbeat about future job prospects and the overall economy, they were less optimistic about income growth. The Present Situation Index, which had been on an upward trend for the past four months, was relatively unchanged in March. Overall, consumers expect the economy to continue improving and believe it may even pick up a little steam in the months ahead.”
In March, the Present Situation Index edged lower, to 80.4 from 81, but the Expectations Index jumped to 83.5 from 76.5. The assessment of people claiming business conditions are “good” climbed higher, from 21.2 percent to 22.9 percent. However, the number of people saying business conditions are “bad” also increased, to 23.2 percent from 22 percent.
The percentage of consumers expecting business conditions to improve over the next six months increased to 18.1 percent from 17.3 percent, while those anticipating business conditions to worsen declined to 10.2 percent from 13.6 percent. The outlook for the labor market also improved. Those expecting more jobs in the months ahead edged higher, to 13.9 percent from 13.7 percent, while those anticipating fewer jobs fell to 18.0 percent from 20.9 percent.
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