Consumer confidence fades
March 26, 2003
Conference Board's index falls for fourth consecutive month
Inman News Features
The Conference Board's consumer confidence index fell by more than two points this month, after declining sharply in February and marking the index's fourth successive monthly drop.
The index stood at 62.5 in March (1985=100), down from 64.8 in February. The expectations index fell to 62.5 from 65.7, and the present situation index declined to 62.4 from 63.5.
"While a quick and successful outcome in the Middle East conflict would certainly ease some of the uncertainties facing consumers and therefore boost confidence, it is the economic fundamentals that will determine whether a rebound is sustainable," said Lynn Franco, director of The Conference Board's Consumer Research Center.
Franco noted that the end of the Gulf War in 1991 created a rise in confidence, but job market conditions diminished the spark. "So if history repeats itself, the current job scenario will do little to maintain any post-war surge in confidence," she said.
Consumers' assessment of the current business environment mirrored last month's readings, according to The Conference Board. Those rating present business conditions as "bad" remained virtually unchanged at 29.8 percent, while those holding the opposite view accounted for 13.8 percent.
Consumers reporting jobs are hard to get rose to 32.3 percent from 30 percent, while those claiming jobs are plentiful remained relatively flat at 11.6 percent.
Consumers' short-term expectations were more pessimistic than last month. Those anticipating that business conditions will worsen over the next six months edged up to 19.9 percent from 19.1 percent, while those anticipating an improvement fell to 13.3 percent from 14.9 percent.
The employment outlook wasn't much better, according to the index. Consumers anticipating more jobs to become available in the next six months declined to 11.1 percent from 12.4 percent, and those expecting fewer jobs dropped to 26.1 percent from 28.5 percent. Consumers anticipating an increase in their incomes declined slightly to 15.8 percent, from 16 percent last month.
The monthly consumer confidence survey is based on a representative sample of 5,000 U.S., and is conducted by NFO WorldGroup, a member of The Interpublic Group of Companies.
The Conference Board is a nonprofit research and business group.
Copyright: Inman News Service