Having hit its lowest level for nearly a decade in February [WAMN: 27-Feb-03], US consumer sentiment has fallen even further this month.
The closely watched confidence index of the Conference Board slipped from last month’s 64.8 to 62.5, with falls in both the assessment of current conditions (63.5 to 62.4) and future expectations (65.7 to 62.5).
The index has not fallen so low since October 1993 – indeed, it has only plumbed such depths in four periods since the survey began in 1967. There is, however, still some way to fall before it reaches the record low of 43.2, set in December 1974.
War is not the only factor hitting confidence. The weak stock market and high unemployment levels have also taken their toll, and could inhibit a recovery even if conflict is resolved swiftly.
“While a quick and successful outcome in the Middle East conflict would certainly ease some of the uncertainties facing consumers and therefore boost confidence, it is the economic fundamentals that will determine whether a rebound is sustainable,” declared the Board’s Lynn Franco.
“The end of the Gulf War in 1991 produced a surge in confidence, but labor market conditions quickly diminished the spark. So if history repeats itself, the current job scenario will do little to maintain any post-war surge in confidence.”
Data sourced from: multiple sources; additional content by WARC staff