John King on US economy: Prices are going up big time
New York (CNN Business)Americans feel more confident now than at any point during the pandemic, new data from The Conference Board showed Tuesday.
The consumer confidence index rose to 127.3 points in June, according to the Conference Board. That was its highest level since February 2020, right before the Covid-19 outbreak first swept across the United States.
Consumers’ assessments of current business and labor market conditions also improved — rising to their best level since March last year — as did the short-term outlook for incomes, business and jobs. More than 50% of survey respondents said jobs were “plentiful”, while only about 11% claimed jobs were hard to find.
These numbers are a strong indicator that “economic growth has strengthened further in Q2,” said Lynn Franco, senior director of economic indicators at The Conference Board. “Consumers’ short-term optimism rebounded, buoyed by expectations that business conditions and their own financial prospects will continue improving in the months ahead.”
While Americans say they still expect higher inflation in the near-term, it’s not weighing on their decisions to spend money or their optimism about future conditions, the survey found.
“In fact, the proportion of consumers planning to purchase homes, automobiles, and major appliances all rose — a sign that consumer spending will continue to support economic growth in the short-term,” Franco added. Spending on vacations also rose.
To be sure, “confidence is not a perfect indicator of plans to spend, but it is certainly a good thing to have highly confident consumers,” said BMO senior economist Jennifer Lee, in a note to clients.
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