The Conference Board's consumer confidence index is essentially unchanged in March at 104.7 versus Econoday's consensus for 106.7 and after a downward revision to 104.8 in February. The index is also close to the reading this time last year of 104.0 in March 2023.

While consumers broadly see current conditions in March as better than the prior month, the outlook six months from now deteriorated to 73.8 from February's 76.3. It was a 3.5-point downward revision to February 's outlook that accounted for the month's headline revision. On net, consumers see a slight weakening ahead in business conditions, fewer employment prospects, and are less hopeful about income increases.

The present situation index rose to 151.0 in March from a small upward revision to 147.6 in February. On net, consumers are more positive about present business conditions and the labor market.

The Conference Board noted that"consumers expressed more concern about the US political environment compared to prior months." Although less worried about a recession, the polarized political landscape in the US appears to be reducing consumers' confidence.

The consumer confidence index is expected to come in unchanged in March at February's 106.7 level. February was far short of expectations for 115.0 and was down from 110.9 January.

The Conference Board's confidence report surveys consumers on their assessments of the labor market, business activity, and their own financial conditions. The survey is conducted by Toluna, an online community platform. (Conference Board and Toluna)

The pattern in consumer attitudes and spending is often the foremost influence on stock and bond markets. For stocks, strong economic growth translates to healthy corporate profits and higher stock prices. For bonds, the focus is whether economic growth goes overboard and leads to inflation. Ideally, the economy walks that fine line between strong growth and excessive (inflationary) growth.

This balance was achieved through much of the nineties and, in large part because of this, investors in the stock and bond markets enjoyed huge gains. It was during the late nineties that the consumer confidence index hit its historic peak, reaching levels that were never matched during the subsequent 2001 to 2007 expansion nor during the long expansion following the Great Recession.

Consumer spending accounts for more than two-thirds of the economy, so the markets are always dying to know what consumers are up to and how they might behave in the near future. The more confident consumers are about the economy and their own personal finances, the more likely they are to spend. With this in mind, it's easy to see how this index of consumer attitudes gives insight to the direction of the economy. Just note that changes in consumer confidence and retail sales don't move in tandem month by month.