After ‘hope’ plunged in January, Conference Board Consumer Confidence was expected to rebound modestly in February along with stocks.
And it did – dramatically so:
Consumer confidence in February rose to 131.4 vs 121.7 in prior month (above the highest forecast – range 118.3 to 128.3 from 60 estimates).
Present situation confidence rose to 173.5 vs 170.2 last month
Consumer confidence expectations rose to 103.4 vs 89.4 last month
“Consumer Confidence rebounded in February, following three months of consecutive declines,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board.
“The Present Situation Index improved, as consumers continue to view both business and labor market conditions favorably. Expectations, which had been negatively impacted in recent months by financial market volatility and the government shutdown, recovered in February.
Looking ahead, consumers expect the economy to continue expanding. However, according to The Conference Board’s economic forecasts, the pace of expansion is expected to moderate in 2019.”
put another way…Stocks are higher because Americans are confident because stocks are higher.
The job market remains exuberant.
And as we noted previously, the gap between current and future expectations hit a record and has historically correlated with a recession…