Consumer confidence slips in May but still at high levels
- Author: Zachary Reyes May 31, 2017,
May 31, 2017, 2:45
The U.S. consumer confidence drop to a still-robust 117.9 from 119.4 (was 120.3) in April and a 16-year high of 124.9 in March left the measure well above prior readings of 116.1 in February and 111.6 in January.
Consumers were less optimistic about the short-term outlook.
USA consumers are still feeling upbeat about the economy but that confidence has dwindled slightly during the past two months, according to The Consumer Conference Board.
"The small decline in the Conference Board measure of US consumer confidence in May is nothing to be anxious about because it is falling from a very high level", said Michael Pearce, an economist for Capital Economics.
Consumers' appraisal of current conditions held steady in May, with those saying business conditions are "good" edging down from 30.8% to 29.4%, and those saying business conditions are "bad" unchanged at 13.7%. The Present Situation Index rose 0.4 point to 140.7, while the Expectations Index declined 2.8 points to 102.6.
Along with the surge on Wall Street, consumer sentiment boomed following November's election of President Donald Trump on hopes of economic renewal sparked by promises of slashed taxes and regulation.
Ian Shepherdson of Pantheon Macroeconomics said the May numbers remained well above their pre-election levels and were supported by sky-high stock prices and an increasingly tight labor market. The number of consumers stating that jobs were "plentiful" edged down to 29.9% in May from 30.3% in April while those claiming jobs are "hard to get" decreased to 18.2% from 19.4%.
Last week the Commerce Department reported that sales of new homes suffered the largest monthly decline in more than two years, but economists suggested it was an anomaly and expect a rebound next month. The percentage of consumers expecting business conditions to improve over the next six months decreased from 25.1 percent to 21.3 percent, however, those expecting business conditions to worsen declined only slightly, from 10.4 percent to 10.1 percent.