(March 31): US consumer confidence unexpectedly rose in March on slightly more upbeat views of current business and labour-market conditions.
The Conference Board’s gauge increased to 91.8, from a revised 91 reading in February, data out on Tuesday showed. The median estimate in a Bloomberg survey of economists called for a reading of 87.9. A gauge of present conditions rose, while a measure of expectations for the next six months fell.
Despite the improvement in March, confidence remains subdued compared to recent years as consumers stay cautious about their job prospects and prices. Rising energy costs tied to the US-Israel war with Iran led to a jump in a measure of inflation expectations in the survey.
“Consumer confidence ticked up again in March, as a modest improvement in consumers’ views of current conditions outweighed a slight downshift in expectations for the future,” Dana Peterson, chief economist at the Conference Board, said in a statement.
“As the war in Iran overlapped significantly with the survey sample period, comments about oil/gas and war/conflict spiked, while specific mentions of trade and tariffs decreased notably,” Peterson said.
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The share of consumers in the Conference Board report who said jobs are currently hard to get rose half a percentage point, to 21.5%, the highest in more than five years. Still, the share saying jobs are plentiful rose by a slightly greater amount, to 27.3%. The difference between these two — a metric closely followed by economists to gauge the job market — was little changed.
Details of the report also showed a larger share of people said they plan to buy refrigerators and other major appliances in the next six months, while a smaller share expect to purchase a home and take a vacation.
The Conference Board’s index generally focuses on labour-market conditions, whereas a separate metric of consumer sentiment from the University of Michigan emphasises views about personal finances and the cost of living. The cutoff for this month’s survey was March 24, more than three weeks into the war.
See also: US trade deficit widened in February by less than forecast
A separate report on Tuesday showed US job openings fell and hiring slowed notably in February, pointing to cooler labour demand before the war triggered additional uncertainty.
Economists in a Bloomberg survey raised their forecasts for inflation through the end of the year and trimmed estimates for consumer spending and employment amid the surge in energy costs.
The government’s monthly jobs report, due on Friday, is expected to show US payrolls advanced at a moderate pace in March, and the unemployment rate held steady, after employers shed jobs in February.
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