Consumer confidence rises in December despite Omicron impact on U.S. economy

After an upward revision in November, the Conference Board Consumer Confidence Index rose again in December. The Index is now at 115.8 (1985=100), up from 111.9 in November (an upward revision).

The Present Situation Index, which measures consumers’ perceptions of current business and labor market circumstances, remained essentially unchanged at 144.1, down from 144.4 last month. The Consumer Expectations Index, which measures consumers’ short-term expectations for income, business, and labor market conditions, increased to 96.9 from 90.2.

“Consumer confidence improved further in December, following a very modest gain in November,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board.

“The Present Situation Index dipped slightly but remains very high, suggesting the economy has maintained its momentum in the final month of 2021. Expectations about short-term growth prospects improved, setting the stage for continued growth in early 2022. The proportion of consumers planning to purchase homes, automobiles, major appliances, and vacations over the next six months all increased.”

“Meanwhile, concerns about inflation declined after hitting a 13-year high last month as did concerns about COVID-19, despite reports of continued price increases and the emergence of the Omicron variant. Looking ahead to 2022, both confidence and consumer spending will continue to face headwinds from rising prices and an expected winter surge of the pandemic.”

Source: Digital Weekday