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April 28, 2005
Consumer Sentiment Wanes
The Conference Board (click here) reports negative data on three fronts. First, the help wanted index declined two points. Second, U.S. consumer confidence dropped over 5 points. Third, the U.S. Leading Index declined in March.
Consumer spending drives 2/3 of GDP and a drop in spending is right behind a drop in confidence. It appears that high energy prices are starting to have an effect. Oil has been above $40 since mid July and above $50 for over 2 months. Even though U.S. spend less on energy than 30 years ago, a sustained period of high prices is certainly not positive.
Posted by Arthur B. Hill at April 28, 2005 04:01 PM