Consumer Confidence Index rises in December
After back-to-back declines in October and November, the Consumer Confidence Index surged upward to a reading of 108.3 in December.
That’s up sharply from 101.4 (1985=100) in November.
Prices at the pump were cited as a key factor in the rise of the index.
“Consumer confidence bounced back in December, reversing consecutive declines in October and November to reach its highest level since April 2022,” said Lynn Franco, senior director of economic indicators at The Conference Board. “The Present Situation and Expectations Indexes improved due to consumers’ more favorable view regarding the economy and jobs. Inflation expectations retreated in December to their lowest level since September 2021, with recent declines in gas prices a major impetus. Vacation intentions improved but plans to purchase homes and big-ticket appliances cooled further. This shift in consumers’ preference from big-ticket items to services will continue in 2023, as will headwinds from inflation and interest rate hikes.”
Gas prices, according to the American Automobile Association, are down to a national average of $3.10 for a gallon of regular, as of Dec. 27. That’s down from $3.56 a month ago.
The Present Situation Index—based on consumers’ assessment of current business and labor market conditions—increased to 147.2 from 138.3 last month. The Expectations Index—based on consumers’ short-term outlook for income, business, and labor market conditions—improved to 82.4 from 76.7. However, Expectations are still lingering around 80—a level associated with recession.
Consumers’ assessment of current business conditions improved in December.
- 19.0% of consumers said business conditions were “good,” up from 17.8%.
- 20.1% said business conditions were “bad,” down from 23.6%.
