Tightening U.S. labor market underpins consumer confidence despite soaring inflation

• U.S. consumer confidence rebounded from a one-year low in March amid growing labor market optimism, but rising interest rates as the Federal Reserve battles raging inflation could hurt motor vehicle purchases and crimp consumer spending. 
• The labor market continues to favor workers, with other data on Tuesday showing job openings hovering near record highs in February. Tightening labor market conditions are boosting wages, providing some cushion against inflation. Consumers' one-year inflation expectations shot up to an all-time high of 7.9%. 
• The Conference Board said its consumer confidence index rose to a reading of 107.2 this month from a downwardly revised 105.7 in February. Economists polled by Reuters had forecast the index falling to 107.0 from February's initially reported 110.5. 
• The improvement in confidence followed the rolling back of COVID-19 restrictions across the country, and was despite gasoline prices remaining above $4.00 per gallon as Russia's war against Ukraine rages on. 
• Consumers' upbeat views of the labor market were underscored by the Labor Department's Job Openings and Labor Turnover Survey, or JOLTS report showing job openings, a measure of labor demand, fell 17,000 to 11.266Mn on the last day of February. Despite the second straight monthly decline, job openings were not too far from a record high of 11.448Mn set in December.

(Source: Reuters)