After an increase in December, the Consumer Confidence Index started the new year off with a decline in January, according to the latest release from The Conference Board. The Index now sits at 107.1 – down from 109.0 last month.
“Consumer confidence declined in January, but it remains above the level seen last July, lowest in 2022,” said Ataman Ozyildirim, senior director, economics at The Conference Board. “Consumer confidence fell the most for households earning less than $15,000 and for households aged under 35.”
Despite the dip in confidence levels, the assessments of current market conditions notched a slight increase. The Present Situation Index – based on consumers’ assessment of business and labor market conditions – moved up to 150.9 after ending last month at 147.4.
But the assessment for the present doesn’t look to be translating for the future. The Expectations Index took a hit, dropping from 83.4 in December to 77.8 in January, a sign that consumers are weary about the state of the economy in the coming months.
“Consumers’ assessment of present economic and labor market conditions improved at the start of 2023. However, the Expectations Index retreated in January reflecting their concerns about the economy over the next six months,” Ozyildirim said. “Consumers were less upbeat about the short-term outlook for jobs. They also expect business conditions to worsen in the near term.”
The short-term outlook on business conditions noted that 21.6 percent of consumers expect conditions to worsen over the next six months, up from 19.9 percent. Consumers expressed a similar sentiment toward the short-term view of the labor market – 20.1 percent of consumers anticipate fewer job opportunities (up from 18.7 percent last month).