ZCZC
BCN-08
US-CONSUMER-CONFIDENCE-INDICATOR
US consumer confidence rises in May
WASHINGTON, May 30, 2018 (BSS/AFP) – US consumer confidence rose in May,
reversing the prior month’s modest decline as consumers’ mood grew rosier,
according to a survey released Tuesday.
The uptick in positive sentiment suggested the world’s largest economy was
improving in the second quarter of the year but expectations for the near
future held steady.
But despite the massive tax cuts in December, fewer respondents felt their
incomes were likely to rise in the coming months, according to the Conference
Board survey.
The consumer confidence index rose 2.4 points to 128.0, up from April’s
125.6, which was revised down. The May result was narrowly better than
economists’ expectations, the survey showed.
The present situation index rose 4.2 points to 161.7, its highest level
since 2001, while expectations for the near term also moved up a token 1.3
points to 105.6.
“Consumers’ assessment of current conditions increased to a 17-year high,”
Lynn Franco, the board’s head of economic indicators, said in statement.
However, “Consumers’ short-term expectations improved modestly, suggesting
that the pace of growth over the coming months is not likely to gain any
significant momentum.”
The share of respondents saying business conditions were good rose 2.6
points to 38.4 percent but their assessment of the jobs market was mixed: the
share saying jobs were “plentiful” rose but so did the share of those saying
jobs were “hard to get.”
The short-term outlook also was modestly better: those saying conditions
would improve fell a half percentage point to 23.6 percent, but those
believing conditions would worsen fell 1.5 points to 8.3 percent.
Those expecting more jobs in the coming months rose 1.1 points to 19.7
percent but those anticipating that jobs will be less plentiful also rose six
tenths to 13.9 percent.
Consumers were less optimistic about wages: those expecting higher income
fell a half a point to 21.3 percent and those expecting wages to fall rose
three tenths to 8.2 percent.
Ian Shepherdson of Pantheon Macroeconomics noted that the 12-month
inflation expectations measure rose by three tenths to five percent, the
highest since September 2016.
“One monthly increase does not make a trend, and this likely is a response
to higher gas prices,” he said, adding that the Federal Reserve members “do
not want to see a sustained increase in these numbers.”
The Fed is widely expected to raise the benchmark interest rate in mid-
June for the second time this year, but expects inflation to remain around
its two percent target.
BSS/AFP/HR/0935