U.S. consumer confidence hits 14-month high; house prices soar

U.S. consumer confidence jumped to a 14-month high in April as increased vaccination against COVID-19 and additional fiscal stimulus allowed for more services businesses to reopen, boosting demand and hiring by companies. The upbeat survey from the Conference Board on Tuesday, which also showed a strong increase in vacation plans, suggested the economy continued to power ahead early in the second quarter after what appears to have been robust growth in the first three months of the year, believed by many economists to have been the second strongest since 2003. Growth this year is expected to be the best in nearly four decades.

The Conference Board’s consumer confidence index raced to a reading of 121.7 this month. That was the highest level since February 2020, just before the onset of the COVID-19 pandemic, and followed a reading of 109.0 in March. It as the fourth straight monthly increase in the index. Economists polled by Reuters had forecast the index increasing to a reading of 113.0 in April.

The survey’s present situation measure, based on consumers’ assessment of current business and labor market conditions, soared to a reading of 139.6 from 110.1 last month. But the expectations index, based on consumers’ short-term outlook for income, business and labor market conditions ticked up to 109.8 from 108.3 in March.

The improving economic climate is expected to be reinforced by the government’s snapshot of first-quarter GDP on Thursday, which according to a Reuters survey of economists will likely show the economy grew at a 6.1% annualized rate during the first three months of the year. That would be the a second-fastest growth pace since the third quarter of 2003 and would follow a 4.3% rate of expansion in the final three months of 2020 and a 33.4% surge in the third quarter of last year.

The Conference Board survey showed the share of consumers expecting an increase in income over the next six months rose to 17.9% from 15.4% in March. The proportion anticipating a drop fell to 10.9% from 12.6% last month.

U.S. consumer confidence hits 14-month high; house prices soar, Reuters, Apr 28