American Consumers Show Decreased Confidence in December, According to Conference Board

American consumers are experiencing a decline in confidence this December, according to a report from a business research group known as the Conference Board.

On Monday, the Conference Board announced that its consumer confidence index has decreased to 104.7 in December, down from 112.8 in November. This drop in confidence was unexpected, as analysts had predicted an increase to a reading of 113.8. In the previous months, consumers appeared to be more optimistic, leading to higher spending as the holiday shopping season approached.

The consumer confidence index provides insights into how Americans view current economic conditions and their expectations for the upcoming six months. Notably, the short-term outlook for income, business conditions, and the job market saw a significant decline, falling by more than a dozen points to 81.1. The Conference Board indicates that readings below 80 may suggest a potential recession could be on the horizon.

Despite this dip, the proportion of consumers forecasting a recession within the next year remained steady.

In terms of current conditions, consumers' perception has slightly decreased, as the index ticked down by just over a point to a reading of 140.2.

Interestingly, consumers have increased their spending at retail locations last month, contributing to a 0.7% rise in retail sales for November. Another report highlighted that consumer spending grew solidly, with a 0.4% increase from October to November. This continued spending trend showcases that households are still playing a vital role in driving the economy forward, with the U.S. economy experiencing a growth rate of 3.1% annually, primarily fueled by consumer demand.

Consumer spending accounts for nearly 70% of economic activity in the United States, making it a crucial focus for economists observing how the sentiments of American consumers evolve.

confidence, economy, spending