US CB Consumer Confidence Index dropped to 86.0 in April

• US CB Consumer Confidence Index declined further in April.
• The US Dollar Index clings todaily gains around the 99.00 region.

US consumer sentiment extended its decline in April, as the Conference Board’s Consumer Confidence Index fell from 93.9 (revised from 92.9) to 86.0—its weakest reading since April 2020.

Consumer sentiment showed fresh signs of strain in April, as views on current business and labor market conditions softened. The Present Situation Index edged down by 0.9 points to 133.5. More notably, the Expectations Index—which tracks short-term outlooks for income, business activity, and employment—plunged 12.9 points to 54.4. That marks its lowest reading since October 2011 and remains well below the 80-point threshold historically linked to recession risks.

Stephanie Guichard, Senior Economist, Global Indicators at the Conference Board, argued: “The decline was largely driven by consumers’ expectations. The three expectation components—business conditions, employment prospects, and future income—all deteriorated sharply, reflecting pervasive pessimism about the future. Notably, the share of consumers expecting fewer jobs in the next six months (32.1%) was nearly as high as in April 2009, in the middle of the Great Recession. In addition, expectations about future income prospects turned clearly negative for the first time in five years, suggesting that concerns about the economy have now spread to consumers worrying about their own personal situations.”

Market reaction

The US Dollar (USD) manages to leave behind part of the recent weakness, prompting the US Dollar Index (DXY) to remain above the key 99.00 support on Tuesday.