Consumer Confidence flat in March
The Conference Board reported today that the Consumer Confidence Index was 104.7 in March, essentially unchanged from a downwardly revised 104.8 in February.
The Present Situation Index—based on consumers’ assessment of current business and labor market conditions—increased to 151.0 (1985=100) in March from 147.6 in February.
The Expectations Index—based on consumers’ short-term outlook for income, business, and labor market conditions—fell to 73.8 (1985=100), down from 76.3 last month. An Expectations Index reading below 80 often signals a forthcoming recession.
“Consumers’ assessment of the present situation improved in March, but they also became more pessimistic about the future,” said Dana Peterson, chief economist at The Conference Board. “Confidence rose among consumers aged 55 and over but deteriorated for those under 55. Separately, consumers in the $50,000-$99,999 income group reported lower confidence in March, while confidence improved slightly in all other income groups. However, over the last six months, confidence has been moving sideways with no real trend to the upside or downside either by income or age group.”
Peterson notes that consumers remained concerned with elevated price levels, which predominated write-in responses.
“March’s write-in responses showed an uptick in concerns about food and gas prices, but in general complaints about gas prices have been trending downward,” Peterson said.
The average 12-month inflation expectations came in at 5.3%—barely changed from February’s four-year low of 5.2%.
“Recession fears continued to trend downward both in write-in responses and as measured by consumers’ Perceived Likelihood of a US Recession over the Next 12 Months,” Peterson added.
The Conference Board said consumers’ outlook for future business conditions, labor market conditions, and income expectations all deteriorated in March. They were also a bit less optimistic about their family’s financial situation, both currently and over the next six months.
On a six-month basis, buying plans for interest-rate sensitive items like autos, homes, and big-ticket appliances dipped again.
However, based on a supplemental question, planned spending for services in 2024 increased relative to the same time last year. Among services, consumers anticipate spending more on healthcare, motor vehicle services, and lodging for personal travel, but less on entertainment.
