The investor’s Consumer Confidence Index for March reached a 4-year low of 92.9, down from 100.1 in February, according to The Conference Board. Also released was the Expectation Index, which lists consumers’ short-term outlook for income, business, and the labor market. Expectations in these areas reached the lowest level in 12 years, down from 72.9 last month to 65.2 and a second consecutive month drop. An expectation level below 80 typically signals the economy is moving toward a recession.
Confidence and expectations numbers are significantly influenced by a negative stock market outlook, which is adding to concerns of rising inflation, uncertainty about the economy, and expectations for lower income. This collective impact is not only pointing towards a potential recession but also raising the specter of stagflation
The growing market fear and increase in caution have led economists to an increased consensus that growth will slow. This shift in their predictions is a significant indicator of the current economic climate.
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