The March Conference Board Consumer Confidence index jumped to 125.6 from 116.1 and that was well above the estimate of 114. This is the best level since December 2000 (during that time it peaked at 144.7 in January ’00 and was 61 in March ’03). I want to caution all that the cutoff for this survey was March 16th so thus will not reflect any changes in opinion after Friday’s failure to pass an overhaul on the ACA.
Both key components were higher m/o/m with Present Situation at 143.1 vs 134.4 last month and vs 123.1 pre election. Expectations jumped also around 10 pts to 113.8 vs 86 in October. Most positive within the report were the answers to the labor market questions where those that said jobs are Plentiful jumped 4.8 pts to the best level since August ’01 (got as high as 55.8 in July ’00). Those that said jobs were Hard to Get fell .4 pts to the lowest since July ’07. There were also nice gains in expectations for business conditions, employment and income.
Spending decisions were mixed. Those that plan to buy a car/truck within 6 months was up by .4 pts to the most since July ’12. The industry certainly hopes these plans follow thru to reduce the excess of inventories on dealer lots. Those that plan to buy a home fell .5 pt to 6% but that comes after rising by .8 pts in February. Those that plan on buying a major appliance was up by3 pts after dropping by 2 pts last month. That is the highest since January ’16.
One year inflation expectations fell two tenths to 4.6% which is near the lowest in 5 years but isn’t too far from the 15 year average of 5.2%.
Bottom line, it’s certainly encouraging to see a bulled up consumer as they are of course a key part of the US growth equation. The jobs and income components were also good to see. This said, consumer confidence numbers are not leading indicators. They are coincident and thus rarely market moving. Also, watch Friday’s UoM consumer confidence figure as it will capture the failed healthcare reform as it’s a call in survey (as opposed to written questionnaire) and thus is more timely.
Peter is the Chief Investment Officer at Bleakley Advisory Group and is a CNBC contributor. Each day The Boock Report provides summaries and commentary on the macro data and news that matter, with analysis of what it all means and how it fits together.