U.S. consumer confidence soars to 14-month high; house prices accelerate
By Lucia Mutikani
WASHINGTON (Reuters) - U.S. consumer confidence jumped to a 14-month high in April as increased vaccinations against COVID-19 and additional fiscal stimulus allowed for more services businesses to reopen, boosting demand and hiring by companies.
The upbeat survey from the Conference Board on Tuesday, which also showed a strong increase in vacation plans, suggested the economy continued to power ahead early in the second quarter after what appears to have been robust growth in the first three months of the year, believed by many economists to have been the second strongest since 2003. Growth this year is expected to be the best in nearly four decades.
"Consumers are seeing the light at the end of the COVID tunnel," said Ben Ayers, senior economist at Nationwide in Columbus, Ohio. "Led by strong spending as households return to eating out, traveling and visiting stores, the economy should surge ahead starting the second quarter and likely carrying into 2022."
The Conference Board's consumer confidence index raced to a reading of 121.7 this month. That was the highest level since February 2020, just before the onset of the COVID-19 pandemic, and followed a reading of 109.0 in March. It was the fourth straight monthly increase in the index.
Economists polled by Reuters had forecast the index would increase to a reading of 113.0 in April.
The survey's present situation measure, based on consumers' assessment of current business and labor market conditions, soared to a reading of 139.6 from 110.1 last month. But the expectations index, based on consumers' short-term outlook for income, business and labor market conditions, ticked up to 109.8 from 108.3 in March.
The United States has expanded vaccination eligibility to American adults, and more than half that population has had at least one dose of a COVID-19 vaccine, according to the U.S. Centers for Disease Control and Prevention. Over a third of U.S. adults are fully vaccinated.
Easing anxiety about the virus and the White House's $1.9 trillion pandemic rescue package have allowed for greater economic re-engagement. Retail sales surged to a record high in March and employers hired the most workers in seven months. Businesses are also investing in equipment to boost production.
U.S. stocks were trading lower. The dollar rose against a basket of currencies. U.S. Treasury prices were mostly lower.
BULLISH LABOR MARKET VIEWS
The Conference Board survey's so-called labor market differential, derived from data on respondents' views on whether jobs are plentiful or hard to get, vaulted to a reading of 24.7 - the largest in 13 months and up from 8 in March.