Data released by Reuters and the University of Michigan show that consumer confidence unexpectedly dropped from 73.6 percent in March to 69.5 percent in April, reports MarketWatch.
Recent job growth and higher-than-expected retail sales over Easter weekend gave the appearance that the recession was beginning to subside, but consumers are expected to remain apprehensive until the economy shows more signs of recovery. Low consumer confidence discourages consumers from spending, further hindering economic growth, Bloomberg reports.
“We’re not seeing much in the way of labor market progress. People are still worried about home prices,” ING Financial chief international economist Rob Carnell told Business Week.
The national unemployment rate continues to hover at 9.7 percent, and first-quarter figures show that mortgage defaults rose seven percent from the previous quarter and 16 percent from one year ago, signs that the recession is lingering. The economic crisis has made many Americans hesitant to spend money, opting to put their income into savings or retirement accounts. Others are struggling to recover from high amounts of consumer debt and loan default
