March felt a lot like the other months since the economy has begun to "recover." Despite a splattering of positive economic reports, the recovery faced some headwinds. Gas prices soared and unrest in the Middle East continued to weigh on the market's mind. Yet looking at those reports provides a pretty clear picture: the U.S. economy continued to improve, though the recovery may have slowed a bit. The big obstacle facing the economy now is weakening sentiment, which may have resulted from those rising gas prices.
Here's our monthly chart providing a snapshot of some of the month's major economic indicators:
Starting with the "direction" column, you see a lot of green. In fact, there's a little more green there than in February, when four metrics were worsening. Moreover, one of those -- foreclosure activity -- is a little bit misleading. Really, foreclosures are being driven more by banks ability to ramp up their new procedures than new defaults. So this statistic is more something to note than something to take to heart about the direction of the housing market.
Unfortunately, there is a theme that can be quickly found in the other two of the three metrics that worsened: sentiment took a hit in March. That's a pretty serious problem in an economy looking for new jobs. Consumer sentiment drives spending, which needs to increase for firms to feel the need to hire more workers. Small businesses were also feeling worse about their economic prospects in March, which also could harm the prospect of more hiring. The only silver lining here is knowing that consumer confidence actually rose a little bit in April