The consumer confidence index plunged in February dropping to 75.0 from a downwardly revised 87.3 last month, the Conference Board reported yesterday.
The January index reading was originally reported as 87.9.
Economists polled by IFR Markets predicted the index would slip to 81.3.
The present situation index fell to 100.6 from a downwardly revised 114.3, originally reported as 115.3, while the expectations index decreased to 57.9 from a downwardly revised 69.3 last month, originally reported as 69.6. The expectations index is at its lowest point in 17 years.
“The consumer confidence index continues losing ground and, with the exception of the Iraqi war in 2003, is now at its lowest level in nearly 15 years [November 1993, 71.9],” said Lynn Franco, director of the Conference Board’s Consumer Research Center. “The weakening in consumers’ assessment of current conditions, fueled by a combination of less favorable business conditions and a sharp rise in the number of consumers saying jobs are hard to get, suggests that the pace of growth in early 2008 has slowed even further. Consumers’ expectations have also deteriorated significantly and are now at a 17-year low [January 1991, 55.3]. With so few consumers expecting conditions to turnaround in the months ahead, the outlook for the economy continues to worsen and the risk of a recession continues to increase.”
