(March 26) US consumer confidence dropped for the fourth time in five months as outlook suggest weak first-quarter growth and slower job increases in February negatively impact on attitudes and spending.
Conference Board index slumps
The Board's index dropped to 124.1 from its previous 131.4 the New York based group announced in a report Tuesday March 26. This was quite contrary to estimates by economists for Bloomberg which called for a rise to 132.5. The measure of views of the present situation has fallen to the lowest level in almost a year. The expectations index is also weaker.
Few new jobs in February
A recent article notes: " The pace of hiring in the U.S. slowed sharply in February as the economy added just 20,000 new jobs, marking the smallest increase in 17 months. The number of new nonfarm jobs created last month was well below the 172,000 MarketWatch forecast, but the slowdown was probably exaggerated by seasonal oddities that are unlikely to persist. The U.S. has been adding more than 200,000 new jobs a month for the past year."
Analysts are predicting the weakest economic growth this present quarter since back in 2016. As the price of gasoline rises, consumers will have less money to spend on other goods and services.
Reasons for more positive attitudes
Wage gains have been the best in a decade giving workers more to spend. Also, there has been a rebound in the stock market. The Federal Reserve, is going to be patient with respect to raising interest rates which could dampen expenditures.
The gloomy survey conflicts with the University of Michigan's preliminary measures of March attitudes which show an advance to the highest measure so far this year led by increases in outlooks both for incomes and the economy.
A Conference Board official's view
Lynn Franco, senior director of economic indicators at the Conference Board said: “Confidence has been somewhat volatile over the past few months, as consumers have had to weather volatility in the financial markets, a partial government shutdown and a very weak February. The overall trend in confidence has been softening since last summer, pointing to a moderation in economic growth.”
Some detailed results
Respondents who said that jobs are plentiful went down from 45.7 percent to 42 percent. On the other hand, those claiming that jobs are hard to get climbed from 11.7 percent to 13.7 percent.
The labor differential measuring the gap between respondents claiming jobs are plentiful and those saying they are hard to get has fallen to the lowest since last July.
However, plans for buying both cars and homes has increased. As the appended video shows the Conference Board index is in contrast to that of the earlier released Consumer Sentiment
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