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To: StanX Long who wrote (9404)	4/12/2003 8:42:24 PM
From: StanX Long	Respond to of 95632

Consumer Confidence Index Jumps to 83.2 in University of Michigan Survey By Siobhan Hughes bloomberg.com Washington, April 11 (Bloomberg) -- U.S. consumer confidence rebounded this month as the march of coalition forces toward Baghdad prompted oil prices to fall and stock prices to rise with the diminished threat of a dragged-out war. The University of Michigan's preliminary consumer sentiment index jumped to 83.2 this month from 77.6 in March, which was the lowest since August 1993, according to people with access to the report. The April reading was the highest since December, and the point increase was the largest since January 2000. The sounding is one of the first to measure consumer sentiment since the war began March 19. The findings suggest that resolution of uncertainties over the war may help the economy as confidence rebounds. Economists say a sustained improvement in the economy depends on companies' willingness to hire and invest. Because of ``the lift in confidence we are seeing now with the war ending favorably, we are looking for the economy to strengthen a bit in the second quarter,'' said Peter Hooper, chief U.S. economist at Deutsche Bank Securities in New York. Economists had expected a reading of 79 in the preliminary consumer sentiment index, based on the median of 61 estimates in a Bloomberg News survey. Forecasts ranged from 74 to 86. The Michigan index is derived from a telephone survey of that will ultimately include 500 households. A final reading is to be issued April 25. Current Conditions The current conditions index, which reflects Americans' perception of their financial situation and of whether it's a good time to spend on big-ticket items, jumped to 94.8 this month from 90 in March. The expectations index, based on optimism about the next one to five years, rose to 75.7, the highest since December, from 69.6 in March. The findings support expectations that economic growth will quicken as the year progresses. Economists in the April 10 Blue Chip Economic Indicators survey projected that growth will accelerate to a 3.6 percent rate in the third quarter and 3.8 percent by the fourth quarter, based on the average of forecasts. ``We feel there's a lot of pent-up demand out there for a lot of consumer goods,'' said Larry Ryder, executive vice president at Hooker Furniture Corp. in Martinsville, Virginia, before the report. ``We're ready for the floodgates to open.'' Auto sales picked up in March to a 16.2 million-unit annual rate from a 15.4 million pace the month before, based on statistics from Autodata Inc. Mortgage Refinancings Consumers are benefiting from low interest rates, too. The Mortgage Bankers Association of America's mortgage refinancing index surged 34.9 percent in mid-March to a record high as the average rate on a 30-year mortgage dropped to the lowest since at least the 1960s. Discounts are also helping. General Motors Corp., the world's largest automaker, expanded rebate offers for April. The company earlier this month said it would offer five-year, no-interest loans this month on all models. Oil prices are falling as war worries abate. The price of crude oil fell to $27.46 a barrel yesterday in trading on the New York Mercantile Exchange. That was down from a 12-year high of $37.83 in mid-March. The Standard & Poor's 500 Index closed yesterday at 871.58, up almost 9 percent from 800.73 on March 11. The pattern of confidence after the first Gulf War provides a cautionary note. The month after that war ended in March 1991, the consumer sentiment index jumped 17.3 points to 87.7, then fell back in subsequent months as the economy kept losing jobs amid a slow recovery from the 1990-1991 recession. Last Updated: April 11, 2003 10:28 EDT