U.S. consumers turned considerably more confident in April, with more seeing a bottom taking shape in the recession-stricken economy, the Conference Board said on April 28. The business research group's consumer confidence index, based on a representative sample of 5,000 U.S. households, leapt to 39.2, up from a revised 26.9 in March, a gain of nearly a point from that month's initial estimate.
The last time consumers were so positive was in November. The index hit bottom in February, at 25.3, its lowest level since tracking of the seasonally adjusted data began in 1967.
"Consumer confidence rose in April to its highest reading in 2009, driven primarily by a significant improvement in the short-term outlook," said Lynn Franco, the Conference Board's research director. Franco said that while the index on the current situation improved moderately, the expectations index for six months forward sharply increased, suggesting that "consumers believe the economy is nearing a bottom." Nevertheless, she pointed out, that index remained "well below" levels associated with strong economic growth.
The expectations index advanced to 49.5, its highest level since the global financial crisis accelerated sharply last September, from 30.2 in March.
Despite the strong leap in the headline reading, "the numbers are very weak still," said Ian Shepherdson, chief U.S. economist at High Frequency Economics. "There is still a long, long way to go," he said, to recover from the entrenched recession that began in December 2007.
The survey, concluded on April 21, found that the number of consumers viewing current business conditions as "bad" fell below 50, to 45.7, down from 51 in March.
Those believing business conditions were "good" rose to 7.6% from 6.9%.
Despite unemployment at a 25-year high of 8.5% in March and a growing number of layoffs, the Conference Board survy found a slight improvement in consumers' jobs outlook. Respondents saying jobs were "hard to get" slipped to 47.9 in April from 48.8 in March. But those seeing "plentiful" jobs also declined, to 4.5 from 4.7 last month.
Copyright Agence France-Presse, 2009