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Consumer Confidence Staggers in March as Sequester Hits

February's uptick in consumer confidence turned around in March, ""The Conference Board"":http://www.conference-board.org/ reported Tuesday.

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The Conference Board's Consumer Confidence Index, conducted for the firm by Nielsen, fell to 59.7 from February's reading of 68.0 (which was revised down from 69.6). The decline wipes out most of the gains observed last month and brings the index to its second lowest reading so far this year.

According to Lynn Franco, director or economic indicators at The Conference Board, the retreat in consumer confidence was driven primarily by a sharp decline in respondents' economic outlook, ""although consumers were also more pessimistic in their assessment of current conditions.""

""The loss of confidence, particularly expectations, mirrors the losses experienced this past December and January. The recent sequester has created uncertainty regarding [COLUMN_BREAK]

the economic outlook and as a result, consumers are less confident,"" Franco said.

The Conference Board's Present Situation Index decreased to 57.9 from 61.4. The number of those saying business conditions are ""good"" decreased to 16.0 percent from 17.6 percent previously, while those stating business conditions are ""bad"" increased to 29.3 percent from 28.2 percent.

Consumers' assessment of the labor market was mixed. The number of those claiming jobs are ""plentiful"" at this time decreased (from 10.1 percent to 9.4 percent), but so did the number of respondents claiming jobs are ""hard to get"" (from 36.9 percent to 36.2 percent).

As far as short-term outlooks, consumers were decidedly pessimistic: The Expectations Index fell to 60.9 in March, a marked drop from 72.4 in February. Those expecting business conditions to improve over the next six months decreased to 14.4 percent from 18.0 percent, while those expecting business conditions to worsen increased to 18.3 percent from 16.6 percent.

The outlook for the labor market was also less favorable than in February. The number of respondents expecting more jobs in the months ahead fell to 12.3 percent from 16.1 percent, while those bracing themselves for fewer jobs increased to 26.6 percent from 22.1 percent.

The proportion of respondents saying they expect their incomes to increase fell to 13.7 percent (from 15.8 percent previously). The number of those expecting a decrease in income also edged down, however, falling to 18.0 percent from 19.3 percent.

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