The Consumer Confidence Index, reported by the Conference Board, slipped again in May.
The Consumer Confidence Index declined to 92.6 in May, from 94.7 in April. Both the present situation index and the expectations index dropped. The present situation index slipped to 112.9, from 117.1 in April, and the expectations index dropped to 79.0, from 79.7 in April.
Consumers’ confidence in current business conditions fell. The share of respondents rating business conditions “normal” declined to 52.5% from 57.6% in April. Two thirds of the 5.1 percentage point decline (3.4%) downgraded their assessment from normal to bad, while only one third upgraded their assessment to good.
But expectations of business conditions six months from now improved. The share of respondents expecting better business conditions rose 1.3 percentage points while the share expecting conditions to worsen rose by a smaller 0.8 percentage point.
Consumers’ assessment of current employment conditions weakened in May. The share of respondents reporting that jobs were “not so plentiful” declined to 51.3% from 53.0% in April. Ninety-four percent of the 1.7 percentage point decline (1.6%) downgraded their assessment from “not so plentiful” to “jobs hard to get”, while only 6% shifted their assessments to “jobs plentiful”.
Moreover, expectations of employment conditions were less favorable. The share of respondents expecting “fewer jobs” over the next six month rose 1.4 percentage points while the share expecting “more jobs” increased only by 0.1 percentage point.
The Conference Board also reported the shares of respondents planning to buy a home within six months. Despite the declines in consumer confidence, the share of respondents planning to buy a home within six months rose to 6.0% in May, from 5.3% in April, indicating a rising confidence in the housing market.
Even though the monthly data is quite volatile, the trend in the shares of respondents planning to buy a home within six months is steadily upward since the recession.