Index Sees Growing Consumer Pessimism
The latest snapshot of U.S. consumers showed confidence was near a decade low even before the grim realities of war in Iraq invaded TV screens.
Being glued to the news also took a toll on chain-store sales last week in what economists have come to call the “CNN effect,” although the long-awaited advent of spring-like weather dragged some from their couches.
Another report Tuesday showed the red-hot housing market was chilled by February’s harsh weather.
The Conference Board’s U.S. consumer confidence index fell to 62.5 in March from 64.8 in February, the lowest since October 1993 and the ninth decline in 10 months. Analysts noted that the measure of “jobs hard to get” deteriorated again, stoking worries that this month’s payrolls report will show little if any recovery from February’s huge fall of 308,000.
Meanwhile, consumers cut back on shopping in the first days of the war with Iraq, as gripping images on TV kept them at home, slicing sales by almost 10%, a report showed Tuesday.
ShopperTrak, a Chicago-based group that tracks retail traffic and sales, said U.S. retail sales fell 9.9% during the first four days of the U.S.-led invasion of Iraq ended Sunday.
Reports varied on retail sales for the full week, however, as warm weather somewhat offset the effect of the start of the war.
According to Bank of Tokyo-Mitsubishi and UBS Warburg, chain-store sales edged up 0.1% in the week ended Saturday, after rising 0.4% the previous week.
But the weekly Redbook report showed sales at major U.S. chain stores dipped 1.1% for the week ended March 22, compared with the same week a year earlier.
Sales of existing homes eased 4.3% in February to an annual pace of 5.84 million, the National Assn. of Realtors said, cooling from a record rate in January.
The median sales price of existing homes in February was $161,600, up 8.2% from the same month last year. The supply of homes on the market fell to 4.4 months, compared with 4.5 months in January.