Consumer confidence fell slightly in April; inflation concerns down

U.S. consumer confidence fell slightly in April as consumers remained optimistic about the future even amid inflation, high gas prices and the war in Ukraine.

The Conference Board’s Consumer Confidence Index edged down to 107.3 in April from 107.6 in March. (The March reading, which was up from 105.7 in February, was the first time the metric has increased in three months.)

The present situation — based on consumers’ assessment of current business and labor market conditions—fell to 152.6 from 153.8 last month. But the expectations index — based on consumers’ short-term outlook for income, business and labor market conditions — ticked up to 77.2 from 76.7.

“The Present Situation Index declined, but remains quite high, suggesting the economy continued to expand in early Q2,” said Lynn Franco, senior director of economic indicators, The Conference Board. “Expectations, while still weak, did not deteriorate further amid high prices, especially at the gas pump, and the war in Ukraine.”

According to the index, Americans’ vacation plans have cooled, but their intentions to buy big-ticket items such as automobiles and many appliances rose somewhat. Purchasing intentions are down overall, however, from recent levels amid rising interest rates.

“Meanwhile, concerns about inflation retreated from an all-time high in March but remained elevated,” Franco said. “Looking ahead, inflation and the war in Ukraine will continue to pose downside risks to confidence and may further curb consumer spending this year.”

Here are highlights from The Conference Board’s April reading.

Present Situation
Consumers’ appraisal of current business conditions was mixed in April.

• 20.8% of consumers said business conditions were “good,” up from 19.6%.
• Conversely, 21.9% of consumers said business conditions were “bad,” up from 21.4%.

Consumers’ assessment of the labor market was less upbeat.

• 55.2% of consumers said jobs were “plentiful,” down from 56.7%.
• 10.6% of consumers said jobs are “hard to get,” up from 9.6%.

Expectations Six Months Out
Consumers’ optimism about the short-term business conditions outlook was mixed in April.

• 18.1% of consumers expect business conditions will improve, down from 19.0%.
• Conversely, 21.8% expect business conditions to worsen, down from 24.1%.

Consumers were less optimistic about the short-term labor market outlook.

• 17.4% of consumers expect more jobs to be available in the months ahead, down from 17.6%.
• 18.9% anticipate fewer jobs, up from 18.0%.

Consumers were less pessimistic about their short-term financial prospects.

• 16.5% of consumers expect their incomes to increase, up from 15.1%.
• 13.8% expect their incomes will decrease, virtually unchanged from 13.7%.

The monthly Consumer Confidence Survey, based on an online sample, is conducted for The Conference Board by Toluna, a technology company that delivers real-time consumer insights and market research through its innovative technology, expertise, and panel of over 36 million consumers.