Consumer Spending Unlikely to Gain Momentum in Early 2020
The Conference Board Consumer Confidence Index® decreased marginally in December, following a slight increase in November. The Index now stands at 126.5 (1985=100), down from 126.8 (an upward revision) in November. The Present Situation Index – based on consumers’ assessment of current business and labor market conditions – increased from 166.6 to 170.0. The Expectations Index – based on consumers’ short-term outlook for income, business and labor market conditions – decreased from 100.3 last month to 97.4 this month.
“Consumer confidence declined marginally in December, following a slight improvement in November,” said Lynn Franco, Director of Economic Indicators at The Conference Board. “While consumers’ assessment of current conditions improved, their expectations declined, driven primarily by a softening in their short-term outlook regarding jobs and financial prospects. While the economy hasn’t shown signs of further weakening, there is little to suggest that growth, and in particular consumer spending, will gain momentum in early 2020.”
The monthly Consumer Confidence Survey®, based on a probability-design random sample, is conducted for The Conference Board by Nielsen, a leading global provider of information and analytics around what consumers buy and watch. The cutoff date for the preliminary results was December 13.
Consumers’ appraisal of current-day conditions improved in December. Those claiming business conditions are “good” was virtually unchanged at 38.7 percent, while those claiming business conditions are “bad” decreased from 13.6 percent to 11.1 percent. Consumers’ assessment of the job market was mixed. Those saying jobs are “plentiful” increased from 44.0 percent to 47.0 percent, however, those claiming jobs are “hard to get” also increased, from 12.4 percent to 13.1 percent.
Consumers were moderately less upbeat about the short-term outlook. The percentage of consumers expecting business conditions will improve over the next six months increased slightly from 18.6 percent to 18.9 percent, while those expecting business conditions will worsen declined from 11.4 percent to 9.3 percent.
Consumers’ outlook for the labor market was mixed. The proportion expecting more jobs in the months ahead decreased from 16.5 percent to 15.3 percent, while those anticipating fewer jobs increased from 13.4 percent to 14.9 percent. Regarding their short-term income prospects, the percentage of consumers expecting an improvement declined from 22.9 percent to 21.1 percent, while the proportion expecting a decrease rose from 6.2 percent to 7.7 percent.
Source: December 2019 Consumer Confidence Survey®
The Conference Board / Release #6145
The Conference Board publishes the Consumer Confidence Index® at 10 a.m. ET on the last Tuesday of every month. Subscription information and the technical notes to this series are available on The Conference Board website: https://www.conference-board.org/data/consumerdata.cfm.
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