After two months of solid gains, the Consumer Confidence Index fell in January and is back to where it was in November 2011.
The index now stands at 61.1, down from 64.8 in December. Both components of the index saw declines. The Present Situations Index fell to 38.4 from 46.5, while the Expectations Index inched down to 76.2 from 77 last month.
Lynn Franco, director of The Conference Board Consumer Research Center, said, “Consumer confidence retreated in January, after large back-to-back gains in the final two months of 2011. Consumers’ assessment of current business and labor market conditions turned more downbeat and is back to November 2011 levels.…Recent increases in gasoline prices may have consumers feeling a little less confident this month.”
Respondents who said jobs in the current labor market were “plentiful” declined to 6.1 percent from 6.6 percent. Looking ahead, the outlook on the jobs front was slightly better. Those expecting more jobs over the next six months rose to 16.2 percent from 14 percent. According to IHS Global Insight’s senior principal economist Chris G. Christopher Jr., the increase to 16.2 percent represents the highest reading since July.
The economist said, “Consumer confidence is still at recessionary levels.” He noted that payrolls were strong in December as additional couriers and messengers were hired to help parcel firms for the growing online retail sales industry.
On the business front, both the current conditions segment and outlook ahead component showed declines. Those who said business conditions are “bad” increased to 38.7 percent from 33.5 percent, while those who expect business conditions to worsen rose to 15.1 percent from 13.4 percent.
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