Consumer Sentiment: Sharp Decline, Expectations Suggest Hope

Bottom Line: Consumer sentiment fell sharply in early April. After stabilizing somewhat late in March, sentiment deteriorated sharply as the impact of the novel coronavirus proved more deadly than expected and resulted in shutdowns in more parts of the country. The index recorded its largest two-month drop in history, 50% larger than the previous record. On the positive side, the decline in the expectations index was less than expected, suggesting consumers expect a rebound following this swift drop. Consumer Sentiment FELL by 18.1 points in early April to 71.0%, compared with market expectations for a decrease to 75.0%. With this month's sharp decline, sentiment is now 27.0% BELOW its year-ago level. Current Conditions FELL by 31.3 points to 72.4%. This is 35.5% BELOW their year-ago level. Consumer Expectations FELL by 9.7 points to 70.0%. With this month's sharp decline, expectations are 19.9% BELOW its year-ago level.