"It was sort of a perfect storm," said Chris G. Christopher Jr., director of consumer economics at IHS Global Insight. "I do expect confidence to rebound as long as there is no government shutdown and the political bickering in Washington doesn't reach a fever pitch."
A healthier job market is also likely to make people feel a little better about their finances.
Employers have added an average of 200,000 jobs per month since November. That's nearly double the average from last spring. The job gains helped lower the unemployment rate in February to a four-year low of 7.7 percent.
Christopher expects economic growth in the January-March quarter to rise at a 2.9 percent annual rate. That would follow a meager gain of 0.1 percent in the October-December quarter, which was largely due to temporary factors, including sharp cuts in defense spending.
Naroff says the government spending cuts taking effect, known as sequestration, could reduce growth by a full percentage point this year. Still, even with the drag, he expects economic growth for 2013 to be around 2.6 percent. That would be better than the 2.2 percent growth in 2012.
AP Business Writers Paul Wiseman and Marcy Gordon contributed to this report.
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