U.S. consumer confidence rose sharply this month, according to new data from The Conference Board. The firm’s closely-watched Consumer Confidence Index reached 101.3 in March, easily surpassing the estimates of economists. February’s confidence reading was also revised upward to 98.8 from 96.4. “This month’s increase was driven by an improved short-term outlook for both employment and income prospects,” said Lynn Franco, director of economic indicators at The Conference Board.
Data showed consumers’ optimism about the short-term outlook, which had slipped last month, rebounded in March. The labor market outlook was also strong and the proportion of consumers expecting growth in their incomes improved to 18.4%. Those anticipating more jobs in the months ahead rose to 15.5%, while those expecting fewer jobs declined from 14.8% to 13.5%.
The Board’s Present Situation Index, though, decreased from 112.1 in February to 109.1 this month. The percentage of respondents that believe business conditions are “good” was unchanged at 26.7%, while those claiming business conditions are “bad” jumped to 19.4%, up from 16.7% in February. The percentage of consumers expecting business conditions to improve over the next six months decreased slightly, from 17.6% to 16.7%.
“Consumers’ assessment of current conditions declined for the second consecutive month, suggesting that growth may have softened in Q1, and doesn’t appear to be gaining any significant momentum heading into the spring months,” Franco said.