Investing.com - Confidence among U.S consumers fell to a one-and-a-half year low in January, as volatility in markets and the partial government shutdown decreased their optimism..
The Conference Board's index of consumer confidence decreased to 120.2 this month, compared to a reading of 124.7 forecast by economists. That was its lowest level since July 2017.
“Financial market volatility and the government shutdown appear to have impacted consumers,” Lynn Franco, director of economic indicators at The Conference Board, said.
“Shock events such as government shutdowns (i.e. 2013) tend to have sharp, but temporary, impacts on consumer confidence. Thus, it appears that this month’s decline is more the result of a temporary shock than a precursor to a significant slowdown in the coming months,” she added.
The Present Situation Index – based on consumers’ assessment of current business and labor market conditions – declined marginally, from 169.9 to 169.6. The Expectations Index – based on consumers’ short-term outlook for income,
The cutoff date for the preliminary results was January 17.
The index looks at U.S. consumer’s views of current economic conditions and their expectations for the next six months. The index is closely watched by economists because consumer spending accounts for about 70% of U.S. economic activity.