An early report of consumer sentiment for March shows a slip in confidence as consumer expectations deteriorate.
The University of Michigan/Thomson Reuters Index of Consumer Sentiment slipped to 79.9 in a preliminary March report after finishing February at 81.6. A consensus forecast from economists surveyed by Bloomberg projected a slight climb to 81.8.
The drop in the headline index came entirely from a fall in the component gauging consumers’ outlook for the months ahead, which was down to a four-month low of 69.4 from February’s 72.7. Meanwhile, the index of current perceptions came up to 96.1 from 95.4.
Even with the latest decline, “[c]onsumer sentiment has been weathering the winter rather well,” said Chris Christopher, director of consumer economics for IHS Global Insight.
“Since December, consumer sentiment has been inching down and inching up—basically holding steady. This is a clear signal that even though consumers were impacted by higher heating bills, relatively poor employment reports in December and January, and not the brightest housing numbers, they feel that things will warm up in the second quarter,” Christopher said.
Looking ahead, IHS expects consumers’ overall mood to improve in the second quarter as job prospects improve and the housing market starts seeing a rebound from the recent slowdown.