by While recession fears have fallen, consumers are concerned about elevated prices and interest rates, which could continue to impact high-ticket purchases such as furniture
WASHINGTON — Consumer confidence remained unchanged in March, while the current outlook for business and labor market conditions rose, according to data released by the Conference Board Tuesday.
The Consumer Confidence Index totaled 104.7, down slightly from 104.8 in February, while the Present Situation Index rose to 151 from 147.6 in February. The improvements in the Present Situation Index were driven by more positive views of consumers’ current employment situation, with those saying jobs are plentiful rose in March, continuing an upward trend since January.
The Expectations Index, which measures short-term income, business and labor market conditions, fell to 73.8 from 76.3 in February. This was the lowest level since October 2023, as consumers are less optimistic about their family’s financial situation over the next six months.
The figures showed that while consumers are feeling better about their present situation, they are more uncertain about the future. Confidence rose among consumers ages 55 and over but fell for those under 55, noted Dana M. Peterson, chief economist at the Conference Board.
“Separately, consumers in the $50,000 to $99,999 income group reported lower confidence in March, while confidence improved slightly in all other income groups,” Petersen said. “However, over the last six months, confidence has been moving sideways, with no real trend to the upside or downside either by income or age group.”
Peterson added that consumers remained concerned with elevated price levels, including food and gas prices, although complaints about gas prices have been decreasing. “Indeed, average 12-month inflation expectations came in at 5.3%, barely changed from February’s four-year low of 5.2%.”
Recession fears also trended downward, although consumers were more concerned about the current U.S. political environment compared to prior months, Peterson said.
While sentiment about stock prices in the year ahead continued to strengthen, the number of consumers expecting an increase in interest rates rose above 50% for the first time since November 2023, the survey said. This could have a negative impact on big-ticket sales as buying plans for interest-rate-sensitive items such as autos, homes, furniture and appliances decreased again.
Consumers also indicated they anticipate spending more on health care, motor vehicle services and lodging for personal travel in 2024 compared to last year. However, they plan to spend less on entertainment.
Other takeaways were as follows:
Regarding their Present Situation:
19.5% of consumers said business conditions were good, down from 20.4% in February.
17.2% said business conditions were bad, down from 17.7% in February.
Regarding the labor market:
43.1% of consumers said jobs were plentiful, up from 42.8% in February.
10.9% of consumers said jobs were hard to get, down from 12.7% last month.
Regarding their expectations six months from now:
14.3% of consumers expect business conditions to improve, up from 14% in February.
17.6% expect business conditions to worsen, up from 16.9% in February.
Regarding the short-term labor market outlook:
13.9% of consumers expect more jobs to become available, down from 14.1% in February.
18.2% anticipate fewer jobs compared to 17.5% in February.
Regarding their short-term income prospects:
16.5% of consumers expect their incomes to rise, up from 16.3% in February.
13.8% expect their incomes to decrease, up from 11.9 last month.
