April 29, 2011—(MCT)—Consumer confidence recovered somewhat in April, though the impact of a spike in gasoline prices is still evident, according to data released Tuesday by the Conference Board.
The confidence index hit 65.4 in April, compared with an upwardly revised 63.8 in March. That’s still below the 72.0 reading of February, as gasoline prices nationally have approached $4 per gallon.
The increase came as consumers’ 12-month inflation expectations declined to 6.3 percent in April from 6.7 percent in March. In addition, consumer views about the present situation improved.
“Consumers’ short-term outlook improved slightly, suggesting that the uncertainty expressed last month is easing,” says Lynn Franco, director of the Conference Board’s consumer research center. “Although confidence remains weak, consumers’ assessment of current conditions gained ground for the seventh straight month, a sign that the economic recovery continues.”
Economists polled by MarketWatch had expected an April reading of 65.
“The Fed will be pleased to see that the further rise in gasoline prices towards $3.90 a gallon does not appear to have put another dent in US consumer confidence or added to households’ inflation expectations,” writes Paul Dales, senior U.S. economist with Capital Economics, in a research note.
The Conference Board’s index helps analysts compare fluctuations in confidence, with a reading of 100 for the base year of 1985. Generally when the economy is growing at a good clip, confidence readings are at 90 and above.
A gauge of consumers’ views of the present situation rose to 39.6 in April from 37.5 in March. About 49 percent of respondents said business conditions are “normal,” while 36 percent said they are “bad” and 15 percent said they are “good.” Meanwhile, the vast majority said jobs are either “not so plentiful” or “hard to get.”
The index for consumers’ expectations increased to 82.6 from 81.3. Most respondents said they expect both business conditions and employment to be the same in six months. Also, while most said they expect the same income in six months, those saying they expect income to increase rose to 16.7 percent from 15.2 percent.
Those with plans to buy an automobile within six months rose to 12.4 percent in April from 11.3 percent in March, while those expecting to buy a home rose to 5.5 percent from 4.1 percent, and those planning to buy major appliances increased to 49.1 percent from 43.8 percent.
For more information visit http://www.marketwatch.com.
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