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Consumer Confidence Continues To Rise In March, According To Discover U.S. Spending Monitorsm

April 04, 2012

Views on U.S. Economy and Finances Improve; Spending Intentions Rise

RIVERWOODS, Ill.--(BUSINESS WIRE)--Apr. 4, 2012-- Consumer confidence rose again in March, spurred by brightening attitudes toward the overall economy and sustained confidence in personal finances. The Discover U.S. Spending Monitor, a 4-year-old daily poll tracking economic confidence and spending intentions of nearly 8,200 consumers throughout the month, climbed 1.6 points to 96.5. The Monitor is at its highest level since October 2007, and has jumped 19.5 points during the past six months.

In March, a quarter of respondents said their personal finances were improving, and 35 percent said that the overall economy is improving – the highest figure since April 2010. At the same time, 50 percent responded that the economy was poor, which is the lowest figure since April 2010.

Highlights of Discover U.S. Spending Monitor Results

  January   February   March
    2012   2012   2012
Discover U.S. Spending Monitor Index   90.5   94.9   96.5
U.S. Economy Improving   30%   32%   35%
Personal Finances Improving   23%   24%   25%
 

Consumer Spending Intentions Rise

Against this backdrop of improved confidence, more consumers reported plans to increase spending over the next 30 days in all categories surveyed by the Monitor. Spending intentions typically rise during this time of year as consumers anticipate higher gas prices and seasonal spending, such as home improvement purchases.

Looking forward, 34 percent plan, in general, to spend more in the upcoming month, up 6 percentage points from February.

  • Of those surveyed, 52 percent plan to spend more on household expenses, including gasoline and groceries. This is a jump of 8 percentage points from the month before, and the highest figure since May 2011. This comes amid rising gas prices.
  • Seventeen percent plan to spend more on home improvement next month, the highest figure since May 2011.
  • Also, 15 percent of consumers said they planned to spend more in the upcoming month on major personal purchases, which is the highest figure since June 2011.

At the same time, 40 percent said they expected a greater expense or shortfall in income in the next 30 days, which is a leap of 7 percentage points from the month before and may indicate added expenses as a result of higher gas prices. The number of people who said they had more money left over in March, compared to the month before, fell to 12 percent, a drop of 2 percentage points.

  • Individuals in households of income below $75,000 annually showed a greater change in confidence in the overall economy than those with higher incomes. For people in households earning between $40,000 and $75,000 annually, 36 percent said the economy is getting better, an increase of 3 percentage points from the month before. For households earning less than $40,000, that figure rose to 26 percent from 23 percent the month before.
  • In contrast, for those in households of incomes higher than $75,000, the number of people who said the economy is improving dropped to 43 percent from 46 percent.
  • In all income categories, fewer consumers report that the economy is getting worse. That figure dropped 2 percentage points to 44 percent.

More Consumers Feeling Better About Their Personal Finances

Improving views about the economy has correlated with more consumers feeling better about their personal finances.

  • Overall, 36 percent said their personal finances were either good or excellent, which is the same figure as February.
  • A quarter of respondents said their personal finances are improving, a slight increase of 1 percentage point from the month before.

For the first time in three years, a majority, 51 percent, of consumers reported having money left over after paying bills. This figure is a slight increase from February and the highest figure since March 2009.

About Discover U.S. Spending Monitor

The Discover U.S. Spending MonitorSM is a monthly index of consumer spending intentions and capacity that is based on interviews with a random sample of 8,200 U.S. adults conducted at a rate of 275 per night. In addition to spending, the survey asks consumers their opinions on the U.S. economy and their personal finances. The Monitor began in May 2007 with a base index of 100. Surveys are conducted by Rasmussen Reports, an independent survey research firm (http://www.rasmussenreports.com).

About Discover

Discover Financial Services (NYSE: DFS) is a direct banking and payment services company with one of the most recognized brands in U.S. financial services. Since its inception in 1986, the company has become one of the largest card issuers in the United States. The company operates the Discover card, America's cash rewards pioneer, and offers personal and student loans, online savings accounts, certificates of deposit and money market accounts through its Discover Bank subsidiary. Its payment businesses consist of Discover Network, with millions of merchant and cash access locations; PULSE, one of the nation's leading ATM/debit networks; and Diners Club International, a global payments network with acceptance in more than 185 countries and territories. For more information, visit http://www.discoverfinancial.com.

Source: Discover Financial Services

Discover
Matthew Towson, 224-405-5649
matthewtowson@discover.com