The Conference
Board (CB) said on Tuesday that its U.S. consumer confidence index jumped 12.3
points to 98.0 in May from a downwardly revised 85.7 (from 86.0) in April. This
marked the first increase in the indicator after five consecutive months of
decline.
Economists had expected
the consumer confidence index to rise only to 87.0.
The survey's
details revealed that the present situation index (+4.8 points to 135.9 this
month) and the expectations index (+17.4 points to 72.8) both surged this
month, but the latter still stayed below the threshold of 80, which typically
signals a recession ahead.
“About half of
the responses were collected after the May 12 announcement of a pause on some
tariffs on imports from China,” the Conference Board highlighted.
Meanwhile, Stephanie
Guichard, Senior Economist, Global Indicators at The Conference Board, noted
that the rebound was already visible before the May 12 U.S.-China trade deal
but gained momentum afterwards. “The monthly improvement was largely driven by
consumer expectations as all three components of the Expectations Index - business
conditions, employment prospects, and future income - rose from their April
lows,” she said, but added that consumers’ appraisal of current job availability
weakened for the fifth consecutive month.
Guichard also
noted that the stock market continued to recover in May. “Consumers' outlook on
stock prices improved, with 44% expecting stock prices to increase over the
next 12 months (up from 37.6% in April) and 37.7% expecting stock prices to
decline (down from 47.2% in April),” she added. “This
was one of the survey questions with the strongest improvement after the May 12
trade deal.”