Consumer Confidence Index Declines In March
After the highest Consumer Confidence reading in three years at 72.0 for February, the index declined in March to 63.4. The Conference Board reported that this could be due to the rising inflation, which was 1.7% for 2010, up from 0.2% in 2009. As consumers’ inflation expectations rose and income expectations declined, consumers are being more careful with their spending as they anticipate higher prices.
Although, consumers’ claiming business conditions are “good” increased 2.7% for March, and those claiming business conditions are “bad” decreased 2.3%. Thus, consumers’ felt that their current conditions did improve in March. However, consumers were not so positive about the future conditions.
While only 44.4% of consumers in February said jobs are “hard to get,” this number edged up to 44.6% in March. Not only did fewer consumers expect an increase in their incomes, but consumers were also pessimistic about the labor market, as the number of consumers expecting more jobs in the future declined to 19.9% from 21.2% in February. Also, consumers are not expecting conditions to improve in the next six months as the percentage declined 4.6% from February to March.