The Conference Board Consumer Confidence Index jumped to 69.6 in February, up 19.2% from January as worries over payroll tax cuts and the fiscal cliff eased, but the index still sits 2.8% below year-ago levels. The Present Situation Index rose 12.6% from last month and is 36.4% above last February, while the Expectations Index rose 23.2% from January but is 16.5% below year-ago levels.
Lynn Franco, Director of Economic Indicators at The Conference Board, said "Consumer Confidence rebounded in February as the shock effect caused by the fiscal cliff uncertainty and payroll tax cuts appears to have abated. Consumers’ assessment of current business and labor market conditions is more positive than last month. Looking ahead, consumers are cautiously optimistic about the outlook for business and labor market conditions. Income expectations, which had turned rather negative last month, have improved modestly."
The International Council of Shopping Centers (ICSC) reported that chain store sales rose a slight 0.1% for the week ending Feb 23rd compared to the prior week, but increased a sharp 2.9% over the prior-year period, which was the strongest gain in 5 weeks.
According to the ICSC‐GS consumer tracking survey, the week's improvement was driven by strength at department stores, apparel stores and wholesales clubs
, but weather was unfavorable for spring seasonal items. According to Weather Trends International (WTI), the U.S. average nationwide temperature was 3.3°F colder than last year and 3.0°F colder than its long‐term trend.
"Consumers saw the snowiest third week of the fiscal-month of February in more than 22 years, according to Weather Trends International, for the South Central states and the second snowiest in the North Central states, which clearly tempered retail sales over the past week," said Michael Niemira, ICSC's vice president of research and chief economist. "Moreover, as the retail industry heads into the final fiscal week of February, spending is likely to be held back by the uncertainty surrounding the potential negative economic impacts from the federal government sequestration."
Retailers said President's Day sales at the beginning of the week offered additional opportunities to clear remaining winter inventories. The department store segment picked up volume, partly the result of promotional activity, while the less promotional discount stores were more mixed. Most schools and offices were closed on Monday drove demand for seasonal apparel and other spring goods. Demand varied by region, tending to be active in the warmer parts of the country. However, many retailers in colder regions also reported improved seasonal business, especially in women's categories, suggesting preemptive buying by certain consumers.
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