U.S. Consumer Confidence Reaches a Five-Year High
The Conference Board Consumer Confidence Index, which had improved in April, increased again in May. The index now stands at 76.2 (1985=100), up from 69.0 in April. The Present Situation Index increased to 66.7 from 61.0. The Expectations Index improved to 82.4 from 74.3 last month. Consumers’ appraisal of present-day conditions also improved in May.
Those saying business conditions are “good” increased to 18.8% from 17.5%, while those stating business conditions are “bad” decreased to 26.0% from 27.6%. Consumers’ assessment of the labor market was also more positive. Those claiming jobs are“plentiful” increased to 10.8% from 9.7%, while those claiming jobs are “hard to get” edged down to 36.1% from 36.9%.
Consumers were considerably more optimistic about the short-term outlook. Those expecting business conditions to improve over the next six months increased to 19.2% from 17.2%, while those expecting business conditions to worsen decreased to 12.1% from 14.8%.
Consumers’ outlook for the labor market was also more upbeat. Those expecting more jobs in the months ahead improved to 16.8% from 14.3%, while those expecting fewer jobs decreased to 19.7% from 21.8%. The proportion of consumers expecting their incomes to increase dipped slightly to 16.6% from 16.8% while those expecting a decrease edged down to 15.3% from 15.9%.
“Consumer confidence posted another gain this month and is now at a five-year high (Feb. 2008, Index 76.4). Consumers’ assessment of current business and labor-market conditions was more positive, and they were considerably more upbeat about future economic and job prospects,” said Lynn Franco, director of economic indicators at The Conference Board. “Back-to-back monthly gains suggest that consumer confidence is on the mend and may be regaining the traction it lost due to the fiscal cliff, payroll-tax hike and sequester.”
The monthly Consumer Confidence Survey, based on a probability-design random sample, is conducted for The Conference Board by Nielsen, a global provider of information and analytics around what consumers buy and watch.
The cutoff date for the preliminary results was May 15.
