Finance Globe

U.S. financial and economic topics from several finance writers.
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Consumer Confidence Rises Dramatically

Despite concerns over the swine-flu outbreak, the markets reacted positively to a report that signals the public's pessimism about the economy may be easing.

Consumer confidence had its biggest one-month jump in four years, from 26.9 in March to 39.2 in April, according to data released today from a survey. The expectations index rose from 30.2 in March to 49.5 in April, signaling that consumers feel better about the direction of the economy and see better days ahead.

Consumers' views on the current economic condition have somewhat improved for April. There were fewer that say business conditions are "bad" - down to 45.7% from 51% the previous month, while those who said business conditions were "good" increased slightly from 6.9% to 7.6%.

Consumers who thought business conditions will worsen over the next six months accounted for 25.3% of those surveyed, down from 37.8% in March. 15.6% felt that business conditions will improve, more than the 9.6% in March.

Only 4.5% of the consumers surveyed thought that jobs were "plentiful" - down slightly from 4.7% from the previous month, and 47.9% felt jobs were "hard to get" - down from 48.8% in March.

But those who believed that there will be fewer jobs in the months ahead decreased from 41.6% to 33.6%, while those who felt there will be more jobs increased in April to 13.9% from 7.3% in March.

The percentage of consumers who expected a pay increase changed little - 8% from last month's 7.8%.

Says Lynn Franco, Director of The Conference Board Consumer Research Center: "Consumer Confidence rose in April to its highest reading in 2009, driven primarily by a significant improvement in the short-term outlook. The Present Situation Index posted a moderate gain, a sign that conditions have not deteriorated further, and may even moderately improve, in the second quarter. The sharp increase in the Expectations Index suggests that consumers believe the economy is nearing a bottom, however, this Index still remains well below levels associated with strong economic growth."

The Consumer Confidence Survey™ is based on a representative sample of 5,000 U.S. households. The monthly survey is conducted for The Conference Board by TNS. TNS is the world's largest custom research company. The cutoff date for April's preliminary results was April 21st.



Sources:
Bloomberg
The Conference Board
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Friday, 23 August 2019

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