U.S. consumer confidence bounced back in May ending five straight months of decline and beating economists’ expectations.
The Consumer Confidence Index increased by 12.3 points in May to 98.0 — up from 85.7 in April — according to a report released Tuesday by The Conference Board. This notably marked the first increase in consumer confidence in five months.
The Conference Board’s Present Situation Index, which is based on consumers’ outlook on current business and job market conditions, increased 4.8 points in May to 135.9. Meanwhile, the Expectations Index, which is based on consumers’ short-term outlook for income, business and job market conditions, jumped 17.4 points to 72.8 in the same month.
“Consumer confidence improved in May after five consecutive months of decline,” Stephanie Guichard, a senior economist at the Conference Board, wrote in the press release. “The rebound was already visible before the May 12 U.S.-China trade deal but gained momentum afterwards. The monthly improvement was largely driven by consumer expectations as all three components of the Expectations Index — business conditions, employment prospects, and future income — rose from their April lows. Consumers were less pessimistic about business conditions and job availability over the next six months and regained optimism about future income prospects. Consumers’ assessments of the present situation also improved.”
“However, while consumers were more positive about current business conditions than last month, their appraisal of current job availability weakened for the fifth consecutive month,” Guichard added in the release.
Earlier in May, President Donald Trump, who has been imposing sweeping tariffs against many foreign countries as part of his broader “America First” trade agenda, announced that the U.S. had reached a trade deal with China, which the White House referred to as a “historic trade win” for America.
Trump’s economy has notched several wins over the past few months, including inflation eased more than expected in April, with the consumer price index (CPI) — a broad measure of the prices of everyday goods — increasing by 0.2%, the Bureau of Labor Statistics (BLS) reported on May 13. Meanwhile, job growth beat expectations in the same month, with the U.S. economy adding 177,000 nonfarm payroll jobs in April, according to BLS data released May 2.
The monthly Consumer Confidence Survey, based on an online sample, is conducted for The Conference Board by Toluna, a technology company that delivers real-time consumer insights and market research through its innovative technology, expertise, and panel of over 36 million consumers. The cutoff date for the preliminary results was May 19.
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