The consumer confidence index declined in January, giving back gains made in December, slipping to 87.9 from an upwardly revised 90.6 last month, the Conference Board reported yesterday.
The December index reading was originally reported as 88.6.
Economists polled by IFR Markets predicted the index would slip to 87.5.
The present situation index rose to 115.3 from an upwardly revised 112.9, originally reported as 108.3, while the expectations index decreased to 69.6 from an upwardly revised 75.8 last month, originally reported as 75.5.
“The modest improvement in consumer confidence last month was short-lived,” said Lynn Franco, director of the Conference Board’s consumer research center. “Consumers’ appraisal of current business conditions is becoming more negative and their assessment of the job market, while slightly less negative than in December, is more negative than a year ago. Looking ahead, consumers are quite downbeat about the short-term future and a greater proportion expect business conditions and employment to deteriorate further in the months ahead. In addition, the percentage of consumers anticipating an improvement in their earnings has declined and could potentially impact spending decisions.”
Business conditions were called “good” by 20.7% of respondents in January, a decrease from 21.2% in December. Those saying conditions are “bad” rose to 20.0% from 18.8%.
The percentage of consumers expecting a pickup in business conditions in the next half year slipped to 11.6% from 13.8%, while 16.0% said they expect conditions to worsen, up from 14.1% the month dvofd.
The number of consumers who expected to buy a home in the next six months held at 2.5%, while the number of respondents planning to buy a car gained to 6.7% from 6.3%.