U.S. Consumer Confidence Rebounds Unexpectedly

By BridgeNews U.S. consumers are increasingly upbeat about the economic outlook, and their spending habits reflect the optimism, two reports released May 29 show. The Conference Board, New York, an economic research and business networking group, said its index of consumer confidence rebounded to 115.5 in May from 109.9 in April. "The rebound in consumer confidence was driven by optimism about future economic conditions," says Lynn Franco, director of the board's Consumer Research Center. "[T]he latest findings report rising confidence about job prospects over the next six months, but reveal growing concern about the current job market. Nowhere, however, are there indications that consumers will curtail their spending, which points to continued economic growth." Consumer spending increased 0.4% in April, twice as fast as in March, the Commerce Dept. reported. The increase in spending was the biggest since January. The Conference Board's monthly survey covers a representative sample of 5,000 U.S. households. An index reading of 100 reflects the level of confidence in 1985. The index of views of the current economic situation increased to 158.6 from 156.0, while the index of economic expectations improved to 86.8 from 79.1. The number of consumers who expect business conditions to improve over the next six months increased to 16.8% from 14.1% of the total, while the number who think the climate will get worse declined to 13.5% from 14.5%. A total of 13.8% of consumers expect more jobs to become available, up from 12.3%, while those who think the job market will deteriorate declined from 22.9% to 19.9%.

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