United States consumers regain their confidence - but also signal a coming recession

Monthly consumer confidence index scores for May have been revealed by the United States' the Conference Board, with unexpectedly positive results.

For last month, the Conference Board's Consumer Confidence Index rose to a reading of 102.00, up from 97.5 in April.

This comes after three consecutive months of declining confidence readings from US consumers, with April expected to be no different.

The numbers were above expectations, certainly.  Forecasts from analysts ahead of the numbers were for a lower confidence reading of 95.9, having declined from April’s 97.  

US recession likely ahead

The Expectations Index also climbed to 74.6 from 68.8 in the same period. However, according to The Confidence Board, it also held a worrying sign of US recession:

What is the CB Consumer Confidence Index?

The Conference Board's the Consumer Confidence Index are the findings a respected monthly survey which tracks prevailing business conditions and likely developments for the months ahead.

These are gleaned from a wide pool of US consumers and companies throughout nine regions and eight different states. This report details consumer attitudes, buying intentions, vacation plans, and consumer expectations for inflation, stock prices, and interest rates. Data are available by age, income, 9 regions, and top 8 states.

A high and improving score on the Consumer Confidence Index is considered an indicator of good economic times ahead for the United States, with a declining or low score indicating the opposite.

Youngest and richest Americans the most confident

On the findings, the Conference Board's chief economist Dana M. Peterson said the following:

Not all good news

However, there were cautionary tales within the overall rosy news, according to Peterson.

"Consumers’ assessment of current business conditions was slightly less positive than last month," she said of the data. "However, the strong labor market continued to bolster consumers’ overall assessment of the present situation. Views of current labor market conditions improved in May, as fewer respondents said jobs were ‘hard to get,’ which outweighed a slight decline in the number who said jobs were ‘plentiful.’"

Peterson added that there was more optimism, but that, also, the news rise in confidence is not as significant as may be expected: