WASHINGTON, D.C. — You can say what you want about Donald Trump but one thing you can’t deny is that he is market gold.
The Conference Board’s consumer confidence index surged to 114.8 in February topping January’s total of 111.8, the Conference Board announced on Tuesday. The numbers are the the best reading since 2001, said a spokesman.
Analysts said they had initially expected the monthly survey report to show a drop of a tenth of a point, but the so called “Trump effect” again turned things around.
“Consumers rated current business and labor market conditions more favorably this month than in January,” Lynn Franco, Director of Economic Indicators at The Conference Board, said in the report. “Expectations improved regarding the short-term outlook for business, and to a lesser degree jobs and income prospects. Overall, consumers expect the economy to continue expanding in the months ahead.”
According to a report published by ZeroHedge (http://www.zerohedge.com/news/2017-02-28/wtf-chart-day-american-consumer-confidence-soars-16-year-highs-real-wages-plunge), consumers questioned in the report said they expect more jobs to be available and fewer say jobs are hard to get.
As referenced in the report, the percentage expecting more jobs in the months ahead increased from 19.7 percent to 20.4 percent, while those anticipating fewer jobs declined from 14.4 percent to 13.6 percent. The percentage of consumers expecting their incomes to increase rose marginally from 18.1 percent to 18.3 percent, while the proportion expecting a decrease declined from 9.4 percent to 8.2 percent.
Economists studying the phenomenon are giving credit directly to Trump.
Preliminary data from a University of Michigan survey published in December found that consumer sentiment, expectations, and views of current economic conditions all experienced a “dramatic turnaround” after President Trump won the election in November.
“The surge was largely due to consumers’ initial reactions to Trump’s surprise victory,” said Richard Curtin, the survey’s Chief Economist. “When asked what news they had heard of recent economic developments, more consumers spontaneously mentioned the expected positive impact of new economic policies than ever before recorded in the long history of the surveys.”
According to a report published by The Christian Science Monitor (http://www.csmonitor.com/Business/2016/1210/Consumer-confidence-soars-does-the-credit-go-to-Trump), the University of Michigan’s annual survey is often viewed as an indicator of the future economy.
Curtin is not alone in his findings. According to the Monitor piece, the numbers exceeded predictions of economists surveyed by Bloomberg (https://www.bloomberg.com/news/articles/2016-12-09/consumer-sentiment-in-u-s-rises-to-highest-since-january-2015) and the Wall Street Journal as well.
“Respondents are viewing the election result in a very positive light,” Joshua Shapiro, chief US economist at MRF, Inc. told the Journal.
Calls for comment from the Trump administration have not yet been returned.