- Consumer Confidence for March fell to 64.5 versus estimates of 73.5 and a reading of 76.4 in February.
BOTTOM LINE: US consumer confidence fell more than forecast in March, Bloomberg reported. The Expectations component of the index fell to 47.9, the lowest since December 1973 during Watergate and the Arab oil embargo. The proportion of people who expect their incomes to rise over the next six months fell to 14.9%, the lowest since record keeping began in 1967. Confidence in the Northeast Central region, which continues to weigh heavily on the overall gauge, plunged to a record low of 35.8. At the depths of the 2000-03 bear market(in which the Nasdaq plummeted almost 80%), confidence in this region never fell below 55.0. Most hedge funds and major media outlets are located in the Northeast Central region. Confidence in the Mountain(96.5) and Southwest Central(95.6) regions remains relatively healthy. The Present Situation component, which gauges consumers’ perceptions of their current financial situation and whether or not it’s a good time to purchase a large-ticket item, fell to 89.2 from 104 the prior month. However, the percentage of consumers planning to purchase a home rose to a seven-month high of 3.3% from 2.9% the prior month.
Johnson Redbook weekly retail sales rose 1.2% this week, the third straight week showing acceleration. This week’s gain is up from a .5% gain three weeks ago. The Richmond Fed Manufacturing Index for March rose to 6 versus estimates of -5 and a reading of -5 in February. This index is now at the highest level in six months. Fed fund futures now imply a 64.0% chance for a 25 basis point cut at the April 30th meeting, down from 72.0% yesterday. The odds for a 50 basis point cut are up to 36.0% from 28.0% yesterday. I suspect consumer confidence readings have now put in place major lows.
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