U.S. Conference Board’s consumer sentiment index rises higher in April

The U.S. Conference Board’s consumer confidence index rose higher in April, in contrast to moderation expectation by consensus. The sentiment index rose to 128.7 in the month, as compared with consensus expectations of falling to 126.

The rebound in the sentiment was spread evenly throughout the present situation and expectations indices. Consumer sentiment has continued to be resilient even in the midst of the recent uncertainty stoked by anti-trade rhetoric and stock market volatility, and consumers’ perception of future economic conditions continue to be favorable. All of these augurs well for consumption spending and GDP growth, stated Barclays.

Delving into details, the present situation index rebounded by 1.5 points to 159.6. Fewer consumers saw business conditions as ‘bad’ and more saw conditions as ‘normal’. The labor differential index, which gauges the net share of consumers who view employment as ‘plentiful’, dropped in April. But the outlook for consumers who view employment as ‘plentiful’, dropped in April.

But the outlook for employment in the next six months rebounded, with a higher share of consumers expecting a rise in employment opportunities. The overall expectations index rose 1.9 points to 108.1. This was driven by a rise in consumers’ expectations of ‘better’ business conditions and a fall in the share of consumers who expect incomes to fall. Moreover, consumers’ intentions of purchasing big-ticket items such as automobiles, homes, and major appliances in the next six months rose.

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