Consumer Confidence jumps, labor market tick up

The Consumer Confidence # at 60.6 was well above estimates of 54, up from 53.3 in Dec and the best level since May ’10. Both the Present Situation and Expectations components rose nicely. Importantly, there were improvements in the answers to the labor market questions. Those that said jobs were Plentiful rose 1 pt to the highest since May ’09 and those that said jobs were Hard To Get fell to the lowest since Jan ’09. Those that see better Business Conditions over the next 6 mo’s rose and those that think they will get worse fell. Those that plan to buy a home within 6 mo’s rose .3 pts, anemic still but at a 3 month high. Those that plan to buy a car also rose to a 3 month high. The one fly and disconcerting for the Fed, 1 year inflation expectations rose to 5.5% from 5.3%, to the highest since July ’09. Net-net, an improving labor market is the catalyst boost to consumer confidence while inflation expectations unfortunately continue to rise.

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