Global| May 29 2012U.S. Consumer Confidence Falls Again
by:Tom Moeller
|in:Economy in Brief
Summary
The Conference Board's Index of Consumer Confidence during May fell for the fourth month in the last five. The 5.5% decline to 64.9 was from 68.7 last month, initially reported as 69.2. Nevertheless, the index remained up by more-than [...]
The Conference Board's Index of Consumer Confidence during May fell for the fourth month in the last five. The 5.5% decline to 64.9 was from 68.7 last month, initially reported as 69.2. Nevertheless, the index remained up by more-than half from the October low. The May number was well below 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 decline in overall confidence reflected-broad-based weakness. The present situation component fell 10.4% (+16.8% y/y) and reversed the prior two months' gains. Respondents indicating that business conditions were good fell sharply. In addition, the percentage reporting that jobs were hard to get rose to its highest (41.0%) since January.
The expectations component of confidence was down by 3.5% (+1.2% y/y), also off for the fourth month this year. The percentage expecting business conditions to improve fell to its lowest since November while the percent expecting more jobs declined to its least since December.
Expectations for inflation in the next twelve months fell m/m to 5.6% versus 6.2% in March. The percentage of people looking for stock prices to rise also dropped sharply this month to 30.8% but the percent who are bearish remained low at 31.6%. The percentage expecting higher interest rates fell to 46.4%
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) | May | Apr | Mar | Y/Y % | 2011 | 2010 | 2009 |
|---|---|---|---|---|---|---|---|
| Consumer Confidence Index | 64.9 | 68.7 | 69.5 | 5.2 | 58.1 | 54.5 | 45.2 |
| Present Situation | 45.9 | 51.2 | 49.9 | 16.8 | 36.2 | 25.7 | 24.0 |
| Expectations | 77.6 | 80.4 | 82.5 | 1.2 | 72.8 | 73.7 | 59.3 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
