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Economy in Brief

U.S. Consumer Confidence Continues To Strengthen
by Tom Moeller  May 28, 2013

Consumer confidence has been building across the board. The Conference Board's Consumer Confidence Index rose to 76.2 this month and built on the upwardly revised April figure of 69.0. Consensus expectations had been for a roughly stable 70.8. During the last ten years, there has been a 47% correlation between the level of confidence and the three-month change in real PCE.

Another sharp improvement in the consumer expectations reading to 82.4 from 74.3 led the strength in the overall confidence index this month. Expectations for better business conditions improved the most, followed by expectations for more jobs. Expectations for the inflation rate in twelve months dropped sharply to 5.3%, the lowest level since December 2010. The percentage expecting higher stock prices surged to its highest since May 2007.

The present situations index improved sharply m/m to 66.7, a breakout to its highest level since May 2008. The 18.8% of respondents who thought that business conditions were good was the most since February 2008. Jobs were thought to be hard to get by 36.1% of respondents. That was down slightly m/m and down sharply versus the high of 49.4% in June 2011. Jobs were viewed as not so plentiful by 53.1% of individuals, down from the recent high but up sharply from the 2011 low of 45.0%.

The consumer confidence index for those under 35 years rose to its highest level since October 2007. Confidence amongst middle-aged individuals also improved to the highest since January 2008 but individuals over 55 years remained the most skeptical age group. Their confidence this month is no higher than February of last year.

The Consumer Confidence data is available in Haver's CBDB database.

 

Conference Board (SA, 1985=100) May April Mar Y/Y % 2012 2011 2010
Consumer Confidence Index 76.2 69.0 61.9 18.3 67.1 58.1 54.5
  Present Situation 66.7 61.0 59.2 48.6 49.8 36.1 25.7
  Expectations 82.4 74.3 63.7 6.6 78.6 72.8 73.7
Consumer Confidence By Age Group
  Under 35 Years 100.9 96.1 83.2 23.7 86.5 77.3 70.4
  Aged 35-54 Years 79.3 69.1 62.3 20.2 68.5 59.8 55.1
  Over 55 Years 62.0 58.1 52.1 12.7 56.6 47.3 47.4
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