WOW: Consumer Confidence SMASHES Expectations At 70.8

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U.S. consumer confidence in February surged to 70.8.Economists were expecting the measure to rise to just 63.0 from January’s reading of 61.1.

“Consumers are considerably less pessimistic about current business and labour market conditions than they were in January,” wrote the Conference Board’s Lynn Franco.  “And, despite further increases in gas prices, they are more optimistic about the short-term outlook for the economy, job prospects, and their financial situation.”  

From the Conference Board:

The Conference Board Consumer Confidence Index® Increases
28 Feb. 2012

The Conference Board Consumer Confidence Index®, which had decreased in January, increased in February. The Index now stands at 70.8 (1985=100), up from 61.5 in January. The Present Situation Index increased to 45.0 from 38.8. The Expectations Index rose to 88.0 from 76.7 in January.

The monthly Consumer Confidence Survey®, based on a probability-design random sample, is conducted for The Conference Board by Nielsen, a leading global provider of information and analytics around what consumers buy and watch. The cutoff date for the preliminary results was February 15.

Says Lynn Franco, Director of The Conference Board Consumer Research centre: “Consumer Confidence, which had declined last month, posted a sizeable improvement in February.  The Index is now close to levels last seen a year ago (Feb. 2011, 72.0.). Consumers are considerably less pessimistic about current business and labour market conditions than they were in January. And, despite further increases in gas prices, they are more optimistic about the short-term outlook for the economy, job prospects, and their financial situation. “

Consumers’ assessment of current conditions was more favourable in February. Those claiming business conditions are “good” increased slightly to 13.3 per cent from 13.2 per cent, while those claiming business conditions are “bad” decreased to 31.2 per cent from 38.3 per cent. Consumers’ appraisal of the labour market was also less pessimistic. Those stating jobs are “plentiful” increased to 6.6 per cent from 6.2 per cent, while those saying jobs are “hard to get” decreased to 38.7 per cent from 43.3 per cent.

Consumers were more optimistic about the short-term outlook than they were last month.  The proportion of consumers expecting business conditions to improve over the next six months increased to 18.7 per cent from 16.7 per cent, while those anticipating business conditions will worsen decreased to 11.8 per cent from 14.6 per cent. Consumers’ outlook for the labour market was also more upbeat.  Those anticipating more jobs in the months ahead increased to 18.7 per cent from 16.4 per cent, while those anticipating fewer jobs declined to 16.9 per cent from 19.1 per cent. The proportion of consumers expecting an increase in their incomes improved to 15.4 per cent from 13.8 per cent.

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