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May 2002

In a hopeful signal of increasing strength within the U.S. economy, consumer confidence spiked in March. Consumer confidence soared in March by nearly 15 points in March to 110.2 from 95.0 in February, according to the Conference Board’s Consumer Confidence Index.

Consumer opinion of present economic conditions and their expectations for the next six months also soared, from 96.4 to 111.5 and from 94.0 to 109.3, respectively. These gains represented the largest in 25 years for the Present Situation Index and 10 years for the Expectations Index.

“Consumers’ confidence has been bolstered by the improvement in business and labor market conditions,” says Lynn Franco, Director of The Conference Board’s Consumer Research Center. “The latest gains are striking… This new boom in confidence should translate into increased consumer spending and stronger economic growth ahead.”

A positive attitude toward employment was also indicated in the Conference Board’s survey.

The Commerce Department, meanwhile, reports that consumer spending increased 0.6 percent in February, continuing the trend started in January. The government also reported that overall economic expansion grew by 1.7% during the last quarter of 2001. Americans’ incomes also increased.

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