The numbers: Consumer confidence surged in March to a one-year high as more Americans got vaccinated and the government doled out $1,400 stimulus checks in a boost to the economy.
The index of consumer confidence shot up to 109.7 this month from a revised 90.4 in February, the Conference Board said Tuesday.
Economists polled by Dow Jones and The Wall Street Journal had forecast a smaller increase to 96.8.
The index stood close to a 20-year high of 132.6 in February of 2020 shortly before the coronavirus pandemic exploded in the U.S.
What happened: Part of the survey that tracks how consumers feel about the economy right now also rose to the highest level since the onset of the coronavirus pandemic.
The so-called present situation index jumped to 110 from 89.6, though it’s still only about two-thirds as high as it was before the pandemic started.
The government sent out $1,400 stimulus payments to most families this month and extended emergency unemployment benefits. The pace of vaccinations has also accelerated sharply across most of the country.
The combination of some extra cash and more financial security is encouraging Americans to spend more.
“Consumers’ renewed optimism boosted their purchasing intentions for homes, autos and several big-ticket items,” said Lynn Franco, senior director of economic indicators at the nonprofit board.
One growing worry: Higher inflation, mainly at the gas pump. That “may temper spending intentions in the months ahead,” Franco said.
Another gauge that assesses how Americans view the next six months —the so-called future expectations index — leaped to 109.6 from 90.9. That’s the highest level in 21 months.
Big picture: The economy is speeding up again after a winter lull, aided by fresh government fiscal stimulus, rising vaccinations and a sharp decline in coronavirus cases compared to the end of last year.
The prognosis for the next several months is good — so long as the coronavirus and its new variants don’t make big inroads in the U.S. like they are doing in Europe.
What they are saying? “Today’s reading looks tremendous relative to the recent past, but it is well short of an ‘all clear, ” said chief economist Stephen Stanley of Amherst Pierpont Securities.