Consumer Confidence by Region: February 2001

The Conference Board's Consumer Confidence Index (CCI) rose by a solid 7.1% between February and March, after declining for five consecutive months. Consumers' assessment of ongoing economic conditions was little changed during March, but their short-term outlook was decidedly more optimistic than in February.

Still, confidence is much lower this spring than it has been over the past several years. With a March 2001 reading of 117.0 on the Conference Board's scale where average confidence during the year 1985 is equal to an index level of 100, the composite CCI was 14.7% lower than during the same month in 2000.

Consumer's assessment of current economic conditions inched ahead 0.1% between February and March. This left the March 2001 index for the "current" component 8.4% lower than during the third month of 2000.

However, the CCI component measuring expectations for the future (defined as 6 months out in this survey) soared 18.2% during March 2001, after plunging by 27% during the first two months of the new year. Despite the sharp upturn during the most recent month, this forward-looking component of the index remains at level 21.7% lower in March 2001 than during the same month of 2000.

The CCI's for eight of the nation's nine regions recorded increases between February and March of this year. The only exception was the 2.8% decline in the confidence measure for the Middle Atlantic (New York, New Jersey, and Pennsylvania) states. The index for the New England region rose for the second month in a row. Double-digit over-the-month gains were recorded in the two Midwest regions (East and West North Central) - a particularly hopeful sign given the declines in manufacturing sector employment experienced during the past year.

Over the year, consumer confidence has declined in every region but the Rocky Mountain states, where March confidence came in a slight 1.1% higher than in the third month of 2000. Every other region recorded a decline of at least 10%.

A solid 4.1% of consumers surveyed nationwide by the Conference Board indicated that they planned to buy a home (either new or existing) over the next six months. This was little changed from the 4.0% share registered both this February and during March of last year, but sharply higher than the 3.3% average that had prevailed over the prior five months. And during this March's survey, 28.9% of consumers said that they planned to make a major appliance purchase during the upcoming six-month-period. This is a higher percentage than in all but one of the previous six months.

Lower interest rates appear to be lifting the spirits of consumers, and causing them to make (at least tentative) plans to increase their spending during the spring and summer.

Building Materials Price Inflation - February

Housing Starts - February

Consumer Confidence by Region - February

New Residential Building Permits by Region - February

Recent Trends in New Residential Permits for 2000's Top 25 Metro Areas