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Confidence Rebounds in May

With Americans feeling more buoyant about current business conditions, consumer confidence bounced back in May from an April downturn, advancing by 1.6% to a level of 108.0 from 106.3 the month before, the Conference Board said.

Lynn Franco, director of the business think tank's Consumer Research Center, said, "The bounce-back in confidence was due primarily to a more upbeat assessment of present-day business conditions. Consumers' view of the job market, both present and six months form now, was little changed and did not provide a boost in confidence."

Despite the rebound in May, "the short-term outlook remains cautious, and rising gasoline prices are having a negative impact on consumers' inflation expectations. All in all, confidence levels continue to suggest growth, albeit at a slow pace."

Consumers' views of current conditions were more upbeat in May, with the number claiming conditions are good rising to 29.4% from 27.5% in April. The number who described conditions as bad was unchanged at 14.5%.

Consumers were also more neutral about the job market, with the number who say jobs are hard to get dipping to 19.9% from 20.3%. The number who said jobs are plentiful was unchanged at 29.0%.

Looking out six months, consumers remain cautious, said The Conference Board. The number who expect conditions to improve rose to 15.1% from 13.8%, while the number who expect conditions to worsen advanced as well, rising to 10.1% from 9.7%. The outlook for the job market six months out was unchanged, with the number who expect more jobs holding steady at 13.3%, while 15.7% expect fewer jobs, also unchanged.

The number who expect their income to increase fell to 17.7% from 18.4% in April.

Confidence by Region

Region % Change
Source: The Conference Board
New England -7.9%
Middle Atlantic -8.3
East North Central 19.2
West North Central -1.9
South Atlantic -0.3
East South Central -0.7
West South Central 2.1
Mountain Pacific 7.7

Buying Plans in May
Plans to purchase over the next six months

Source: The Conference Board
Homes -3.3%
Major appliances 9.6
Cars -1.6
Vacation 2.7

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