The US Conference Board’s Consumer Confidence Index for April, released this morning, beat expectations by 8.6 points, measuring in at 121.7. This reading builds on the gains measured in March, as consumers begin to shift toward an improved economic outlook for Q2 of 2021.
The trade-weighted Dollar Index (DXY) remained largely unchanged on the back of this release.
Today’s reading marks the highest Consumer Confidence figure since March 2020, suggesting consumers across the US are over the worst of pandemic related stagnation. Consumers claiming business conditions are “good” conditions increased by 5.0 points in March, and those claiming jobs are “plentiful” increased by 11.4 points.
Looking into the index’s components, much of the strength in the headline figure comes from a significant improvement in the Present Situation Index. That figure rose from 110.1 to 139.6, suggesting a more than favorable assessment of President Joe Biden’s fiscal stimulus plan and vaccine rollout. Stimulus checks are making it into the hands of consumers, and as of today, the number of individuals who are fully vaccinated has risen more than those who have had just one dose in the US.
Although consumer outlook has improved substantially in the short term, there are still question marks around where the economy will be toward the latter half of this year.
The Expectations Index only rose 1.5 points, and those expecting business conditions to improve in the next 6 months only rose by 0.2 points. This uncertainty has also filtered through to the outlook for the job market, as the proportion of consumers expecting job increases declined from 35.9 to 34.5.
Overall today’s data release looks to be a good omen for economic performance in the US. The administration appears to be in the good graces of those participating in this month’s consumer confidence survey, but it has not yet been enough to convince them they are out of the woods entirely.
The pandemic has ultimately made consumers skeptical that the current trajectory of an economic recovery can continue late into the year. There is hope in this regard, but not consumers don’t appear fully confident that will be the case.
Account Executive & Currency Analyst
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