Consumer confidence rebounded in March, as Americans regained optimism about the short-term outlook for the economy.
The Conference Board’s index of consumer confidence rose to 96.2 in March from an upwardly revised 94.0 in February, the group said Tuesday.
Several economists attributed the upswing to improvement in financial markets following volatility at the start of the year.
March’s rise “suggests that the rebound in stock markets more than offset the impact of higher gasoline prices in recent weeks,” Steve Murphy, U.S. economist at Capital Economics, said in a note to clients.
Economists surveyed by The Wall Street Journal had expected consumer confidence to rise to 93.8 in March. February’s preliminary reading had been reported as 92.2.
The details of the report were mixed. The expectations subindex, which tracks consumers’ expectations for the next six months, rose to 84.7 from 79.9 the prior month. But the present situation index dropped slightly to 113.5 from 115 in February, touching its lowest level since November.
“The confidence figures do not point to a breakout in either direction from the consumer, just more of the same, which in the case of the consumer would be good news,” said Stephen Stanley, chief economist at Amherst Pierpont Securities.
Consumers’ outlook on the labor market was mixed. The share of respondents who said jobs were currently “plentiful” rose to 25.4%, the highest level since 2007. But the share of those who said jobs were “hard to get” also rose in March to 26.6%, the highest level since July.
Fewer consumers reported an expected rise in incomes in the next six months, which some economists flagged as one reason consumer spending hasn’t broken out in a meaningful way.
“The souring in attitudes toward income growth could continue to underpin the cautious tone in consumer spending,” said Millan Mulraine, an economist at TD Securities USA LLC. “This has been underscored by the mixed tone in big-ticket buying intentions.”
Consumer sentiment has been broadly positive for more than a year. A number above 90 is generally considered a good reading. But consumer spending has slowed of late, rising only 0.1% each month between December and February, the Commerce Department said Monday. The savings rate rose in February to match its highest level since 2012.
The year kicked off with volatile equity markets, and consumers may be concerned about stalling growth in overseas economies. But the U.S. labor market has been steadily adding jobs, and wages have risen over the past year.
Write to Anna Louie Sussman at [email protected]