After a nice pick-up in January, the closely-watched Conference Board check-up on consumer confidence declined sharply in February, going from 56.5 to 46.0. A score of 100 equals conditions as they existed in 1985.
The Present Situation Index also came down, from 25.2 in January to 19.4; and the Expectations Index dropped from 77.3 to 63.8.
Conference Board’s Lynn Franco said, “Consumer Confidence, which had been improving over the past few months, declined sharply in February. Concerns about current business conditions and the job market pushed the Present Situation Index down to its lowest level in 27 years (Feb. 1983, 17.5). Consumers’ short-term outlook also took a turn for the worse, with fewer consumers anticipating an improvement in business conditions and the job market over the next six months. Consumers also remain extremely pessimistic about their income prospects. This combination of earnings and job anxieties is likely to continue to curb spending.”
Only 16.7% of those surveyed expect an improvement within the next six months, down from 20.7% in January; and 15.3% think things will get worse during that period – that number is up from 12.7%. Only 13.4% expect upcoming job creation, and only 9.5% expect an increase in income during the same period.