Consumer confidence rebounded sharply this month to near a post-Great Recession high since 2007 as Americans were more positive about their financial situation and outlook for the economy, according to a leading private barometer released Friday (April 25).
As reported by the Los Angeles Times, the monthly consumer sentiment index from the University of Michigan and Thomson Reuters, which is watched closely by economists and investors, rose to 84.1 from 80 the previous month.
The jump surprised economists, who had expected a smaller increase to 82.5. The April reading was short of the 85.1 level reached in July, which was the highest since 2007.
Lindsey Piegza, chief economist at Sterne Agee, said confidence has rebounded more than economic growth.
“Perhaps consumers are no longer using pre-recessionary times as a comparison but rather a new, lowered bar of expectations, accepting a new normal,” she said.
But Piegza also noted that “rising equity and home prices, coupled with the return of warmer
spring weather has boosted consumers’ spirits and expectations of further economic
Richard Curtin, the survey’s chief economist, warned that consumers’ long-term expectations for the economy had not improved much since last year and were the key to avoiding sharp fluctuations in confidence.
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