Recent stock market volatility and rising gas prices may be behind the strong decline in consumer confidence in March, The Conference Board reported today.
The consumer confidence index retreated to 107.2 this month from 111.2 in February, and Lynn Franco, director of The Conference Board Consumer Research Center, said in a statement that the direction of financial markets and oil prices “bears watching to determine whether this decline is just a bump in the road or something more substantial.”
Consumers’ overall assessment of present-day conditions was little changed in March, as those claiming conditions are “good” dipped to 28.3 percent from 28.7 percent and those saying conditions are “bad” was virtually unchanged at 14.9 percent.
Labor market conditions remain mixed this month, as more consumers (19.1 percent) say jobs are “hard to get,” up from 17.9 percent in February, while those claiming jobs are “plentiful” rose to 30.5 percent from 27.8 percent last month.
“Despite diminishing expectations, consumers’ assessment of present-day conditions remains steady and does not suggest a weakening in economic conditions,” Franco said.
For the short term, more consumers expect business conditions to worsen, up from 8.2 percent last month to 9.8 percent in March, while fewer (14.5 percent) see conditions improving, compared with 15.9 percent in February.
The outlook for the labor market was also more pessimistic, as the percentage of consumers expecting fewer jobs in the months ahead increased to 16.5 percent from 14.2 percent, and those anticipating more jobs to become available declined to 12.7 percent from 13.3 percent. The proportion of consumers expecting their incomes to increase in the months ahead fell to 17.5 percent from 19.2 percent in February.
The Consumer Confidence Survey is based on a representative sample of 5,000 U.S. households.