Consumer confidence jumped in February, reversing the declines recorded in the previous three months.
The Conference Board said Tuesday that its Consumer Confidence Index increased in February 131.4, up from 121.7 in January. That is the highest reading since November of last year and beats economists expectations for a 125 reading.
Consumers were happier with their present circumstances and more confident about the future, according to the Conference Board.
“The Present Situation Index improved, as consumers continue to view both business and labor market conditions favorably. Expectations, which had been negatively impacted in recent months by financial market volatility and the government shutdown, recovered in February. Looking ahead, consumers expect the economy to continue expanding,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board.
The strongest rebound was in consumers’ optimism about the short-term future. The share of consumers expecting business conditions will improve over the next six months increased from 16.3 percent to 19.7 percent, while those expecting business conditions will worsen decreased from 13.8 percent to 8.9 percent.
Consumers’ outlook for the labor market also turned sharply positive. The share saying they expected more jobs in the months ahead increased from 15.3 percent to 18.5 percent, while those anticipating fewer jobs declined, from 16.2 percent to 12.2 percent.
Those stating jobs are “plentiful” decreased slightly from 46.7 percent to 46.1 percent, while those claiming jobs are “hard to get” also decreased, from 12.6 percent to 11.8 percent.