The Conference Board Consumer Confidence Index, which had declined in April, continued its downward trend in May and now stands at 57.2 (1985=100), down from 62.8 in April – and a 16-year low (Oct. 1992, 54.6), the Conference Board reported.
The Present Situation Index decreased to 74.4 from 81.9 in April. The Expectations Index declined to 45.7 from 50.0 in April.
“Weakening business and job conditions coupled with growing pessimism about the short-term future have further depleted consumers’ confidence in the overall state of the economy,” said Lynn Franco, Director of The Conference Board Consumer Research Center.
“Consumers’ inflation expectations, fueled by increasing prices at the pump, are now at an all-time high and are likely to rise further in the months ahead.”
More findings issued by the Board:
- Consumers’ appraisal of current conditions grew more pessimistic in May. Those claiming business conditions are “bad” rose to 30.6% from 26.5%, while those claiming business conditions are “good” decreased to 13.1% from 15.4% last month.
- Consumers’ assessment of the job market was also more downbeat. The percentage of consumers saying jobs are “hard to get” was virtually unchanged, 28.0% versus 27.9% in April. Those claiming jobs are “plentiful” declined to 16.3% from 17.1%.
- Consumers’ short-term expectations weakened further in May. Consumers anticipating business conditions to worsen over the next six months increased to 33.6% from 27.4%, while those anticipating business conditions to improve increased slightly to 10.4% from 10.1% in April.
- The outlook for the labor market was little changed, but remains pessimistic. The percentage of consumers expecting fewer jobs in the months ahead declined moderately to 32.4% from 32.9%, while those anticipating more jobs was virtually unchanged, 8.7% versus 8.8% in April. The proportion of consumers expecting their incomes to increase declined to 13.4% from 15.5%.
About the data: The Consumer Confidence Survey is based on a representative sample of 5,000 US households. The monthly survey is conducted for The Conference Board by TNS. The cutoff date for May’s preliminary results was May 20.