Consumer confidence in the U.S. declined in December, driven by weaker assessments of current business conditions, future expectations, and income prospects, according to The Conference Board.
Fewer consumers viewed current business conditions as favourable (19.1%, down from 21.6% in November), and more rated them as bad (16.7%, up from 15.3%). Optimism about future business conditions also declined, with only 21.7% expecting improvement (down from 24.7%) and 18.3% expecting worsening conditions (up from 15.9%).
Current job market assessments improved, with 37% saying jobs are “plentiful” (up from 33.6%) and fewer (14.8%) saying jobs are “hard to get” (down from 15.2%). However, future labor market expectations worsened, as only 19.1% expected more jobs (down from 22.8%), while 21.3% expected fewer (up from 17.9%).
Fewer consumers (17.2%) anticipated income growth (down from 20.7%), while more (14.3%) expected a decline (up from 12.1%).
Inflation and Recession: Inflation expectations stabilized at 5%, the lowest since March 2020. Recession expectations for the next 12 months remained near the series low. The Consumer Confidence Index dropped by 8.1 points to 104.7, with the Present Situation Index slipping to 140.2 and the Expectations Index falling sharply to 81.1, close to the level often signaling a potential recession.
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