### Consumer Confidence Surges in Response to U.S.-China Trade Developments

In May, consumer confidence saw a significant rebound, driven by renewed optimism regarding trade relations between the U.S. and China. Data from the Conference Board's Consumer Confidence Index showed a leap to 98.0, marking a 12.3-point increase from April. This rise far exceeded the Dow Jones consensus estimate of 86.0.

This surge in positive sentiment mainly stemmed from progress in the U.S.-China trade negotiations. A key event was President Donald Trump's decision on May 12 to halt the most severe tariffs, which greatly contributed to the consumer optimism reported by board officials. "The rebound was already visible before the May 12 US-China trade deal but gained momentum afterwards," noted Stephanie Guichard, the Conference Board's senior economist for global indicators.

May's increase in consumer confidence came after five consecutive months of declines. The continual trade tensions, particularly between the U.S. and China, had dampened economic prospects for many consumers and investors. Nonetheless, a trade truce reached in early May marked a significant easing in tensions, representing the second major retreat from the tariffs announced by Trump since his declaration on April 2.

Additional indicators from the Conference Board also reflected growing optimism. The present situation index saw a rise to 135.9, up by 4.8 points, while the expectations index surged to 72.8, a significant 17.4-point gain. As a result, 44% of investors now anticipate that stock values will be higher over the next 12 months, an increase of 6.4 percentage points from April.

Perceptions of the labor market have also improved. Approximately 19.2% of respondents expect more job opportunities in the coming six months, compared to 13.9% in April. Conversely, those expecting fewer jobs fell to 26.6% from 32.4%. However, those who described jobs as "plentiful" remained relatively flat at 31.8%, while perceptions of employment being "hard to get" rose slightly to 18.6%.

The survey showed that the wave of positive sentiment was broadly felt across different demographics, income brackets, and political affiliations. However, the "strongest improvements" were noted among Republicans, according to survey officials.