Despite record-high gas prices, consumer confidence brightened in May, The Conference Board reported today.
The Consumer Confidence Index rose to 108 this month from 106.3 in April, mostly because current-day business conditions seem better, but the outlook for the rest of the year is still uncertain.
“The bounce-back in confidence was due primarily to a more upbeat assessment of present-day business conditions,” Lynn Franco, director of The Conference Board Consumer Research Center, said in a statement. “Consumers’ view of the job market, both present and six months from now, was little changed and did not provide a boost in confidence. The short-term outlook remains cautious, and rising gasoline prices are having a negative impact on consumers’ inflation expectations. All in all, confidence levels continue to suggest growth, albeit at a slow pace.”
Although the percentage of consumers claiming conditions right now are “good” rose to 29.4 percent this month from 27.5 percent in April, there wasn’t any change in the availability of jobs, as those claiming jobs are “plentiful” held at 29 percent.
Over the next six months, the outlook for business conditions remains mixed, as 15.1 percent of consumers anticipate an improvement, up from 13.8 percent last month, while more consumers (10.1 percent) expect conditions to worsen, up from 9.7 percent.
The percent of consumers expecting more jobs in the months ahead was relatively flat this month at 13.3 percent, while those anticipating fewer jobs, 15.7 percent, was also unchanged. The proportion of consumers expecting their incomes to increase in the months ahead declined to 17.7 percent from 18.4 percent in April.
The Consumer Confidence Survey is based on a representative sample of 5,000 U.S. households.