Consumer confidence falls to year’s lowest level after weak job growth
Consumer confidence surprisingly tumbled this month to its lowest level of the year as weak job growth increased concerns about the state of the economy.
The index by the Conference Board, a closely watched barometer of consumer attitudes, fell to 95.2 from 101.4 in March, the group said Tuesday.
The March figure was close to the 7-1/2-year high of 102.9 reached in January. Analysts had expected the index to rise this month to about 103.
But a spate of disappointing economic data took its toll on consumer confidence.
Economic growth appeared to have slowed sharply in the first quarter of the year, economists said, in large part because of severe winter weather in the Northeast and Midwest.
Analysts expect the Commerce Department to report Wednesday that the economy expanded at just a 1% annual rate from January through March, down from 2.2% in the fourth quarter of last year.
Reflecting that weakness, job growth in March was a disappointing 126,000 -- less than half the number of net new positions created the previous month.
“Consumer confidence, which had rebounded in March, gave back all of the gain and more in April,” said Lynn Franco, the group’s director of economic indicators.
“This month’s retreat was prompted by a softening in current conditions, likely sparked by the recent lackluster performance of the labor market, and apprehension about the short-term outlook,” she said.
Consumer confidence is one of the indicators that Federal Reserve policymakers are monitoring as they meet Tuesday and Wednesday to decide when to start raising the central bank’s short-term interest rate.
No rate increase is expected this month, but Fed officials have indicated one could come as early as June.
The percentage of respondents in the Conference Board’s survey who expected business conditions to improve over the next six months decreased to 16% this month from 16.8% in March.
Those expecting more jobs in the same period decreased to 13.8% from 15.3%.
Respondents who said jobs were plentiful fell to 19.1% from 21% in March, while those who said jobs were “hard to get” increased to 26.4% from 25.5%.
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