Consumer confidence bounced from 90.4 in February to 109.7 in March in the Conference Board’s monthly index of consumer sentiment.
Economists surveyed by Dow Jones and the Wall Street Journal had expected a reading of only 96.8.
The index charted 132.4 in February 2020 on the cusp of the pandemic.
The confidence index measures shoppers’ outlook; the “present situation index,” which gauges consumers’ feelings about the current moment, climbed from 89.6 to 110 over the month, still about a third lower than just before the pandemic struck.
The future expectations index, which specifically targets peoples’ view of the next six months, bounded from 90.9 in February to 109.6 last month, a 21-month peak.
“Consumers’ renewed optimism boosted their purchasing intentions for homes, autos, and several big-ticket items,” Lynn Franco, the Conference Board’s senior director of economic indicators, said in comments quoted by MarketWatch, but a rising inflation rate “may temper spending intentions in the months ahead,” she cautioned.
The new confidence survey “looks tremendous relative to the recent past, but it is well short of an ‘all clear,'” Stephen Stanley, chief economist at Amherst Pierpont Securities, told MarketWatch.
TREND FORECAST: Consumer confidence will fall dramatically when equity markets crash. We maintain our forecast for consumer optimism to continue to rise as long as interest rates remain low and Washington and the Federal reserve pump in trillions to inflate the economy and equity markets.
As long as interest rates stay low, the areas where real estate prices have shot up will remain strong. And even when the equity markets crash, these sectors will not suffer sharp declines.
