U.S. Consumer Confidence Weakens in April

The Conference Board's Index of Consumer Confidence Index fell 2.6% (-6.7% y/y) to 101.3 after rising 0.6% to 104.0 in March, revised from 104.2. The index remained 21.4% below its most recent peak in June 2021. A reading of 104.1 for April had been expected in the Action Economics Forecast Survey.

Performance amongst the component series remained mixed. The Expectations Index weakened 8.0% (-13.8% y/y) to 68.1 following a 5.1% March increase to 74.0, revised from 70.4. The index was 39.1% below its March 2021 peak. The Present Situation Index improved 1.5% (-1.2% y/y) to 151.1. It stood 5.3% below its June 2021 peak.

Consumers' assessment of current business conditions held steady m/m as 18.8% of respondents characterized conditions as good in April. Labor market readings deteriorated sharply this month. The jobs gap, representing the difference between respondents indicating that jobs are plentiful versus those saying jobs are hard to get, rose slightly to 37.3% in April from a downwardly revised 36.5% in March. Calculated by Haver Analytics, this series has a 67% correlation with the unemployment rate over the last ten years. The jobs plentiful measure rose to 48.4%, reversing a small part of its March decline. The jobs hard to get measure eased to 11.1%, which was down from 13.7% in November.

Consumers assessment of future business conditions fell as a lessened 13.5% of respondents felt that conditions would get better in six months. It was close to the lowest percentage in seven years. Thirteen percent of respondents felt there would be more jobs in six months, the fewest since May 2016. A lessened 15.7% expected income to increase in six months, down from a 19.6% high this past October.

The expected inflation rate in twelve months edged down to 6.2% from 6.3% in March. Fairly stable in the last two months, it remained below the 7.9% high in June of last year. Nevertheless, it remained well above the 4.4% low in January 2020.

A lessened 59.3% of respondents felt that interest rates would be higher in twelve months while a steady 11.3% thought they would be lower. A lessened 29.3% of respondents thought that stock prices would be higher in twelve months and a lessened 34.5% thought they would be lower.

The share of respondents planning to buy a home within six months fell sharply to 5.0%, the least since September 2022 and below the October high of 7.4%. It nevertheless remained higher than its 4.5% low in July of last year. Those planning to buy a major appliance dropped sharply to 41.0% of respondents this month. It’s fallen from a high of 52.4% six months ago.

The Consumer Confidence data are available in Haver's CBDB database. The total indexes, which are indexed to 1985=100, appear in USECON, and market expectations are in AS1REPNA.