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Consumer Confidence: Modest Cooling in Outlooks

May 25, 2021
Bottom Line:  Consumer sentiment fell in May, and the Conference Board revised its April reading lower.  Consumers were a touch less sanguine about their prospects for income gains.  Overall though, the index of expectations remains near the high end of its historical range. The present situation index is well off its lows, if still below elevated pre-pandemic levels. Consumers reported that jobs were more plentiful in April amid continued reopenings.  As vaccines help reopenings, expect a surge in services spending and a continued hiring surge in that sector followed by a longer readjustment period as consumers shift their spending patterns back towards services, away from goods, reversing a trend seen since the pandemic.
Consumer Confidence FELL by 0.3 points in May to 117.2, compared with market expectations for an increase to 118.8.  The index is now 36.4% ABOVE its year-ago level.
Present Situation Index
ROSE by 12.4 points to 144.3. The index is 111.0% ABOVE its year-ago level.
The Expectations Index
FELL by 8.8 points to 99.1.  The index is 1.5% ABOVE its year-ago level.                               
The labor differential, the percentage of respondents who said jobs are “hard to get” from the percentage who said jobs are “plentiful” , moved higher by 13.0 points to 34.6.