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Economy in Brief

U.S. Consumer Confidence Declines Slightly
by Tom Moeller  April 24, 2012

The Conference Board's Index of Consumer Confidence during April slipped to 69.2 from 69.5 last month, initially reported as 70.2. Nevertheless, the latest two figures were the highest since February 2011 and were up nearly three-quarters from the October low. The April number fell slightly short of Consensus estimates for 70.0. During the last ten years there was been a 48% correlation between the level of confidence and the three-month change in real PCE.

The slip in overall confidence owed to a lower expectations component which edged down m/m to 81.1, although it was nearly its highest level in a year. The percentage expecting business conditions to improve fell to 18.8%. Expectations for more jobs slipped m/m but remained sharply higher than the September low. Down m/m, income expectations also have improved sharply versus the recession low.

The present situation reading improved to 51.4 from a downwardly-revised March level. Fewer respondents saw jobs as being plentiful and there also was a decline in the "jobs hard to get" reading. An improved 15.3% of respondents thought business conditions were good and the percentage of respondents indicating that conditions were bad was 33.5% versus 51.0% at the recession peak.

Expectations for inflation in the next twelve months fell back m/m to 5.8% from 6.2% in March. The percentage of people looking for stock prices to rise increased to 35.7% this month, the most optimistic since February of last year, while the percent who are bearish fell to 29.1%, the least negative since February 2011. The percentage expecting higher interest rates rose to 48.8%

Headline figures on consumer confidence are carried in Haver's USECON database. The Conference Board's detailed data are found in Haver's CBDB database, and the consensus expectations figure is from Actions Economics, as tabulated in the AS1REPNA database.

Conference Board (SA, 1985=100) Apr Mar Feb Y/Y % 2011 2010 2009
Consumer Confidence Index 69.2 69.5 71.6 4.8 58.1 54.5 45.2
Present Situation 51.4 49.9 46.4 27.9 36.2 25.7 24.0
Expectations 81.1 82.5 88.4 -2.5 72.8 73.7 59.3
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