Consumer Confidence Unexpectedly Rises in May
Consumer confidence rose unexpectedly in May as consumers felt better about the current and future economy. The Consumer Confidence Index climbed to 102.0, up from 97.5 in April, and surpassing economists’ predictions of 96.0, according to the latest data from the Conference Board.
Not Out Of The Woods: Despite the increase, confidence levels remain at the second-lowest level in the last six months, reflecting ongoing concerns about the economy.
By the numbers:
- The Present Situation Index, which assesses current business and labor market conditions, increased by 2.5 points to 143.1.
- The Expectations Index, reflecting consumers’ short-term outlook for income, business, and labor market conditions, rose to 74.6 from 68.8 in April.
What They’re Saying: Dana M. Peterson, Chief Economist at The Conference Board, highlighted an income divide in confidence levels. “…those making over $100K expressed the largest rise in confidence. On a six-month moving average basis, confidence continued to be highest among the youngest (under 35) and wealthiest (making over $100K) consumers.”
Between The Lines: Confidence improved across all age groups, but disparities persist based on income. The rise suggests some resilience in consumer sentiment despite broader economic uncertainties.
The Bottom Line: While the unexpected rise in consumer confidence is a positive sign, the underlying income divide and relatively low confidence levels indicate that economic challenges remain.
