A monthly measure of consumer confidence has dropped on far less optimistic expectations for business and labor conditions over the next six months.
The Conference Board reported that its Consumer Confidence Index fell nearly nine points to 63.4 in March. While consumers’ assessments of current conditions improved, a measure of their short-term outlook tumbled more than 16 points.
“The sharp decline in confidence was prompted by a sharp decline in expectations,” said Lynn Franco director of the Conference Board Consumer Research Center. “Consumers’ inflation expectations rose significantly in March and their income expectations soured, a combination that will likely impact spending decisions.”
The Conference Board, a business research and networking group, bases the CCI on the results of monthly surveys conducted by the Nielsen Company. Economists closely monitor the index because consumer spending accounts for more than two-thirds of economic activity in the country.
Consumer assessments of current conditions pushed the Present Situation Index more than three points higher to 36.9.
The proportion of consumers responding to the survey who characterized business conditions as “good” rose nearly three points to 15.1 percent, while the share of those who said conditions are “bad” fell more than two points to 37 percent.
The proportion of consumers who described jobs are “plentiful” fell a half point to 4.4 percent, while the share of those who said jobs are “hard to get” edged up two-tenths to 44.6 percent.
Consumer outlooks for the next six months drove down the Expectations Index to 81.1.
The share of consumers who expect business conditions to improve fell nearly five points to 20.6 percent, while the proportion of those who anticipate worsening conditions rose almost six points to 16.2 percent.
The share of consumers who believe more jobs will become available slipped more than a point to 19.9 percent, while the proportion of those who anticipate fewer jobs rose nearly six points to 20.7 percent.
The share of consumers who expect their incomes to increase dropped more than two points to 15.3 percent.