Consumer Confidence declines in November

The Conference Board Consumer Confidence Index decreased in November after also losing ground in October.

The Index now stands at 100.2 (1985=100), down from 102.2 in October.

Other data points showed declines, as well:

• The Present Situation Index—based on consumers’ assessment of current business and labor market conditions—decreased to 137.4 from 138.7 last month.

• The Expectations Index—based on consumers’ short-term outlook for income, business, and labor market conditions—declined to 75.4 from 77.9.

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Gas prices seemed to have a major impact on the declining confidence index, said Lynn Franco, Senior Director of Economic Indicators at The Conference Board. At the latest tally, the American Automobile Association’s measure of the national average price of a gallon of regular stood at $3.52. that’s down from $3.76 a month ago, but up from $3.39 last year at this time.

“The Present Situation Index moderated further and continues to suggest the economy has lost momentum as the year winds down,” Franco said. “Consumers’ expectations regarding the short-term outlook remained gloomy. Indeed, the Expectations Index is below a reading of 80, which suggests the likelihood of a recession remains elevated.”

Franco piled on a pessimistic view for 2023: ““Inflation expectations increased to their highest level since July, with both gas and food prices as the main culprits. Intentions to purchase homes, automobiles, and big-ticket appliances all cooled,” Franco said. “The combination of inflation and interest rate hikes will continue to pose challenges to confidence and economic growth into early 2023.”

There was some good news, as consumers’ assessment of current business conditions was mixed in November, as 18.2% of consumers said business conditions were “good,” up from 17.7%.

On the other hand, more consumers, 26.7%, said business conditions were “bad,” up from 24.0%.

The monthly Consumer Confidence Survey, based on an online sample, is conducted for The Conference Board by Toluna, a technology company that delivers real-time consumer insights and market research through its innovative technology, expertise, and panel of over 36 million consumers.