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Economy in Brief

U.S. Consumer Confidence Slips in April
by Tom Moeller  April 26, 2022

• Present situation & expectations are little changed m/m.

• Expectations for employment deteriorates.

• Expectations for inflation dip.

The Conference Board Consumer Confidence Index during April weakened 0.3% (-8.7% y/y) to 107.3 from 107.6, revised from 107.2. A reading of 107.5 had been expected in the Action Economics Forecast Survey.

The Present Situation Index fell 0.8% this month (+15.7% y/y) to 152.6 after rising 7.6% in March to 153.8. The Consumer Expectations index improved 0.7% in April (-28.5% y/y) to 77.2, following three straight months of sharp decline.

The jobs gap, representing the difference between respondents indicating that jobs are plentiful and those saying jobs are hard to get, slipped to a 44.6% from the record 47.1% in March. Calculated by Haver Analytics, this series has had a 69% correlation with the unemployment rate over the last ten years. The jobs plentiful measure fell this month to 55.2% from the record 56.7% in March. The jobs hard-to-get measure rose to 10.6% of respondents.

Current business conditions were perceived as good by an increased 20.8% of respondents in April. Expectations that business conditions would improve in six months fell to 18.1% of respondents, down from 42.5% in April 2020. More jobs were expected in six months by a lessened 17.4% of respondents, half the percentage twelve months ago. The percentage expecting rising income improved to 16.5% of respondents.

The expected inflation rate in twelve months slipped to 7.5% from 7.9% in March. It remained up from a 4.4% low in January of 2020. Roughly two-thirds of respondents expected that interest rates would rise over the next twelve months, the most in three years. The share of respondents planning to buy a home within six months held fairly steady m/m at 5.9% and remained below a June 2020 high of 6.8%. Those planning to buy a major appliance rose sharply m/m to 49.8% of respondents, but remained below 53.9% registered in July 2021.

The Consumer Confidence data are available in Haver's CBDB database. The total indexes, which are indexed to 1985=100, appear in USECON, and market expectations are in AS1REPNA.

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