Consumer confidence bounces back in May
WASHINGTON – American consumers were feeling a bit more optimistic in May following a slight decline in confidence in April.
The Conference Board, a business research group, said Tuesday that its consumer confidence index rose to 128.0 from a revised 125.6 in April. That follows March’s 127.0 and February’s 130.0, which was the highest reading since November of 2000.
Despite wild stock market swings and ongoing U.S. trade disputes, the index came in about where analysts expected. Some analysts say it bodes well for the future as unemployment remains low and Americans have more money to spend after last year’s tax cut.
The index measures both consumers’ assessment of current economic conditions and their expectations for the future. Both categories rose this month; however, consumers’ views of the current labor market were mixed. The percentage of respondents who said they felt that jobs were “plentiful” rose, as did the percentage of consumers saying that jobs were “hard to get.”
According to the survey, the number of consumers who think current business conditions are good shot up to 38.4 percent from April’s 34.8 percent. It’s the highest mark in that category of the survey since a 40.8 percent reading in December of 2000. The number of respondents in May who said they think business conditions are bad decreased slightly from April.
Consumers’ views of the short-term future were mixed. Those expecting business conditions to improve over the next six month ticked down slightly, as did the number who thought conditions would worsen.
With the U.S. unemployment rate at 3.9 percent, the number of respondents expecting more job prospects in the coming months increased slightly, as did the number of those who expected fewer.
Economists closely watch consumers’ moods because their spending accounts for about 70 percent of all U.S. economic activity.
The Commerce Department reported that U.S. retail sales in April increased at a 0.3 percent rate, a sign that consumers may be back after weak spending earlier this year.