US consumer confidence plunges the most since 1973 — but near-term expectations improve

• The Conference Board's consumer confidence index fell to 86.9 in April from 118.8 in March, the largest drop since 1973, according to a Tuesday report.
• The present situation index fell 90 points in April to 76.4, the largest drop on record, according to Lynn Franco, senior director of economic indicators at The Conference Board.
• On the flip side, the expectations index jumped to 93.8 in April, from 86.8 in March. The index weighs short-term expectations for the economy and labor market.
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US consumer confidence slumped in April, following a sharp drop in March as the coronavirus pandemic continues to inflict economic pain. At the same time, a measure of future optimism improved.

The Conference Board's consumer confidence index fell to 86.9 in April from 118.8 in March, the largest drop since 1973, according to a Tuesday report. The reading was roughly inline with economists surveyed by Bloomberg — the median estimate was for a decline to 87.

The present situation index fell 90 points in April to 76.4, the largest drop on record, according to Lynn Franco, senior director of economic indicators at The Conference Board. A 45.2% share of consumers said that current business conditions are bad, the highest since 2010. In addition, those saying that jobs are hard to get increased to 33.6% from 13.9%.

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This slump "reflects the sharp contraction in economic activity and surge in unemployment claims brought about by the COVID-19 crisis," Franco said.

Future optimism rose during the month, however, "likely prompted by the possibility that stay-at-home restrictions will loosen soon, along with a re-opening of the economy," according to Franco. The expectations index jumped to 93.8 in April, from 86.8 in March. The index weighs short-term expectations for the economy and labor market.

And, consumers expect that business conditions and the labor market will improve in the future. As many as 40% said they expect better business conditions in six months, while 41% expect more jobs in the same timeframe, both record highs.

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