According to The Conference Board, US consumer confidence rose in April and remained very strong increasing to 134.1. Gains in employment and positive expectations for short term business conditions have largely influenced the survey results. US Consumers continue to be optimistic about economic growth regardless of recent relatively weak retail sales. The percentage of surveyed consumers who felt that business conditions were “good” increased to 38.3% of those surveyed. Correspondingly, the percentage of those surveyed who were more pessimistic about economic conditions fell to 10.2%.
The survey results are important because changes in consumer confidence have proven to be reliable measures of future business activity in an economy and is used as a “leading indicator” of economic conditions for the next 1 – 3 months. Notwithstanding our expectations for moderating growth in the USA, we still maintain that US economic growth will approximate 2% – 2.5% during the next 6 – 12 months.