The Conference Board's Consumer Confidence Index dipped slightly in April coming in at a reading of 69.2. That was narrowly below the 69.5 score recorded for March. Expectations had been that this metric would have totaled 70.2--the same survey result as had initially been estimated for March.
Overall, such a confidence score is rather respectable, and remains well above the 40 to 45 range seen last summer and early fall, specifically between August and October. However, after jumping quickly and sharply from November through February, when the index went from the mid-50s to a 71.6 score, confidence has flattened out--perhaps reflecting the unwelcome rise in weekly jobless claims recently, the worsening debt and economic crisis in the euro zone, an uneven stock market in this country, and high gasoline prices at the pump.
According to Lynn Franco of the Conference Board, ``Consumer Confidence was virtually unchanged in April, following a modest decline in March. As was the case last month, the slight dip was prompted by a moderation in consumers' short-term outlook, while their assessment of current conditions continued to improve. Overall, consumers are more upbeat about the state of the economy, but they remain cautiously optimistic.''
To this point, consumers' assessment of current conditions improved this month, with those seeing business conditions as good rising from 14.3 to 15.3. Although that is still a low score, the trend is moving in the right direction, at least. Also, those claiming jobs were hard to get eased, as well, falling from 40.7 last month to 37.5 in April.
On balance, the report was reasonable, albeit not what many were hoping for, as the economy continues to make progress, just not the material strides needed, in our view, to get the unemployment rate down below 8% and get the real estate market turning notably higher. Coincidently, a report out at the same time, showed that sales of new homes came in at 328,000 annual units sold in March--off moderately from the upwardly revised 353,000 homes estimated to have been sold in February. Originally, the February estimate had been given at 313,000 homes. Thus, here, too, we are seeing incremental strides being made on an average basis, just not the dramatic gains that are needed to really light a fire under the U.S. economy.
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.