NEW YORK-A more pessimistic outlook among consumers drove the consumer confidence index down 8.1 points this month, to 58.6, according to The Conference Board, which provides the monthly indicator.
That drop, combined with declines in both November and December, erased all of the gains the index had made in 2012. Lynn Franco, The Conference Board’s director of indicators, said the board’s survey of consumers found them to be more negative now about both the economy and their financial situation. “The increase in the payroll tax has undoubtedly dampened consumers’ spirits, and it may take a while for confidence to rebound and consumers to recover from their initial paycheck shock,” Franco said.
Both of the component indexes posted falloffs in the January survey. The expectations index lost 8.6 points to finish at 59.5, and the present situation index was down 7.3 points to 57.3.
Consumers’ appraisal of current business conditions declined this month, with the percentage of those saying current business conditions are “good” decreasing and the percentage of those saying business conditions are “bad” swinging upward. In addition, the percentage of consumers expecting a rise in business conditions down the road fell off, while the percentage of those looking for a decline in business conditions in the future rose.