Consumer confidence rises as fiscal cliff, tax concerns abate
Home Accents Today Staff -- Home Accents Today, February 27, 2013
NEW YORK - Consumer confidence rebounded sharply this month, rising to 69.6 from 58.4 in January, the Conference Board reported Tuesday.
The research organization said its latest survey indicated that the Present Situation Index increased to 63.3 from 56.2 and the Expectations Index improved to 73.8 from 59.9 last month (1985=100). Feb. 14 was the cutoff date for the survey.
The index regained the ground it had lost in January, when it fell more than 12 points to its lowest level in 14 months.
"Consumer confidence rebounded in February as the shock effect caused by the fiscal cliff uncertainty and payroll tax cuts appears to have abated," said Lynn Franco, director of economic indicators at The Conference Board. "Consumers' assessment of current business and labor market conditions is more positive than last month.
"Looking ahead, consumers are cautiously optimistic about the outlook for business and labor market conditions. Income expectations, which had turned rather negative last month, have improved modestly," she said.
Consumers' assessment of present conditions improved in February. Those claiming business conditions are "good" rose to 18.1% from 16.1%, while those stating business conditions are "bad" decreased to 27.8% from 28.4%.
Their appraisal of the labor market was mixed. Those saying jobs are "plentiful" increased to 10.5% from 8.5%, while those claiming jobs are "hard to get" edged up to 37% from 36.6%.
Consumers were more optimistic about the short-term outlook this month. Those expecting business conditions to improve over the next six months increased to 18.9% from 15.6%, while those expecting business conditions to worsen declined to 16.5% from 20.4%.
Consumers' outlook for the labor market was more positive. Those anticipating more jobs in the months ahead improved to 16.7% from 14.4%, while those expecting fewer jobs decreased to 21.5% from 26.7%. The proportion of consumers expecting their incomes to increase rose to 15.7% from 13.5%, while those anticipating a decrease fell to 19.6% from 23.3%.