Economic Snapshot: Consumer confidence at highest level in 16 years

Following a trend over the last few months of soaring consumer confidence, the index is now at its highest level since December 2000.

Consumer confidence

Consumer confidence increased from 116.1 in February to 125.6 in March.

The Present Situation Index rose from 134.4 to 143.1 and the Expectations Index increased from 103.9 to 113.8.

The percentage of consumers saying business conditions are “good” increased from 28.3 percent to 32.2 percent and those saying business conditions are “bad” decreased from 13.4 percent to 12.9 percent.

The percentage of consumers stating jobs are “plentiful” rose from 26.9 percent to 31.7 percent and those claiming jobs are “hard to get” decreased from 19.9 percent to 19.5 percent.

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The percentage of consumers expecting business conditions to improve over the next six months rose from 23.9 percent to 27.1 percent and those expecting business conditions to worsen declined from 10.5 percent to 8.4 percent.

The proportion expecting more jobs in the months ahead increased from 20.9 percent to 24.8 percent and those anticipating fewer jobs declined from 13.6 percent to 12.2 percent. The percentage of consumers expecting their incomes to increase improved from 19.2 percent to 21.5 percent and the proportion expecting a decrease declined from 8.1 percent to 7.0 percent.

New home sales

Sales of new single-family homes were at a seasonally adjusted annual rate of 592,000 in February, according to estimates released jointly by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 6.1 percent above the revised January rate of 558,000 and 12.8 percent above the February 2016 estimate of 525,000.

The median seals price of new houses sold in February was $296,200 and the average sales price was $390,400.

The seasonally adjusted estimate of new houses for sale at the end of February was 266,000. This represents a supply of 5.4 months at the current sales rate.

GDP

Real gross domestic product increased at an annual rate of 2.1 percent in the fourth quarter of 2016, according to the “third” estimate released by the Bureau of Economic Analysis. In the third quarter or 2016, real GDP increased 3.5 percent.

The “third” estimate is based on more complete source data than were available for the “second” estimate issued last month. In the “second” estimate, the increase in real GDP was 1.9 percent. The “third” estimate’s general picture of economic growth remains largely the same, but personal consumption expenditures increased more than previously estimated.

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