Associated Press - A private research group said Tuesday that consumer confidence in May soared to the highest level since last September amid tentative signs that the economy was improving.
The Conference Board said that its Consumer Confidence Index, which had sharply increased in April, zoomed past economists’ expectations to 54.9, from a revised 40.8 in April.
Economists surveyed by Thomson Reuters were expecting 42.3.
The reading marks the highest in eight months, when the level was 61.4. The levels are also closer to the year-ago reading of 58.1.
The present situation index, which measures how shoppers feel now about the economy, rose to 28.9 from 25.5 last month. But the Expectations Index, which measures shoppers’ outlook over the next six months, climbed to 72.3 from 51.0 in April.
“Looking ahead, consumers are considerably less pessimistic than they were earlier this year, and expectations are that business conditions, the labor market and incomes will improve in the coming months,” Lynn Franco, director of the Conference Board Consumer Research Center, said in a statement. “While confidence is still weak by historic standards, as far as consumers are concerned, the worst is now behind us.”
The upbeat reading was good news for merchants, which are counting on consumers to be in the mood to spend, after confidence plummeted to record lows.
The Consumer Confidence survey — whose responses were received through May 19 from a representative sample of 5,000 households — showed a marked improvement in consumers’ outlook for jobs. The percentage of consumers expecting more jobs in the months ahead increased to 20.0 percent, from 14.2 percent, while those anticipating fewer jobs declined to 25.2 percent, from 32.5 percent. The proportion of consumers anticipating an increase in their incomes edged up to 10.2 percent, from 8.3 percent.http://www.nytimes.com/2009/05/27/business/economy/27consumer.html
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