The Conference Board Consumer Confidence Index, which had increased in March, improved further in April. The Index now stands at 109.6 (1985=100), up from 107.5 in March. This is the highest level since May 2002 (110.3).
The Present Situation Index rose to 136.2 from 133.3. The Expectations Index improved to 91.9 from 90.3 last month.
“Improving present-day conditions continue to boost consumers’ spirits,” says Lynn Franco, director of The Conference Board Consumer Research Center. “Recent improvements in the labor market have been a major driver behind the rise in confidence in early 2006. Looking ahead, consumers are not as pessimistic as they were last month. However, expectations for the economy and labor market have been trending downward since peaking in 2003. And, while prices at the pump have yet to impact confidence, further increases could dampen consumers’ mood.”
Consumers’ overall assessment of current conditions remains favorable. Those claiming conditions are “good” rose to 29.7 percent from 27.9 percent. Those claiming conditions are “bad,” however, also rose to 15.1 percent from 14.7 percent. Labor market conditions, which had been mixed, improved. Consumers saying jobs are “plentiful” increased to 29.1 percent from 28.3 percent, while those claiming jobs are “hard to get” edged down to 19.6 percent from 20.4 percent.
Consumers’ outlook for the next six months improved moderately in April. Those expecting business conditions to worsen decreased to 9.1 percent from 9.8 percent. Those expecting business conditions to improve, however, also decreased to 17.1 percent from 17.8 percent.
The outlook for the labor market was mixed. Those expecting more jobs to become available in the coming months increased to 15.7 percent from 13.7 percent in March. Those expecting fewer jobs, however, remained unchanged at 16.4 percent. The proportion of consumers anticipating their incomes to increase in the months ahead declined to 17.1 percent from 19.3 percent.
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. The cutoff date for April’s preliminary results was April 18.