Americans’ outlook for the U.S. economy fell in December to match the weakest for the year and a weekly measure of confidence cooled to a two-month low, even as both gauges remain high by historical standards, the Bloomberg Consumer Comfort Index showed Thursday.
HIGHLIGHTS OF CONSUMER COMFORT (WEEK ENDED DEC. 17)
Monthly gauge of economic expectations declined to 47 in Dec. from 53
Weekly comfort index fell to 50.8, lowest since week ended Oct. 8, from 51.3
Measure tracking current views of economy rose to 51.3 from 50.9
Index of buying climate declined to 43.1, from 44; personal finances gauge slipped to 58 from 58.9; both lowest since Oct.
The pullback in the monthly gauge reflects an increased share of people saying the economy is getting worse, which at 34 percent is the highest since November 2016 and 6 percentage points above this year’s average. That, along with a decline in the weekly gauge, suggests that consumer spending may not be as strong in the coming weeks as previously thought. It could also reflect unfavorable reactions to the Republican tax legislation.
At the same time, Americans’ confidence remains elevated: the weekly index was the best for the period ahead of Christmas in 11 years. The average for 2017 is also the highest since 2001. A tight labor market spurring job creation and a holiday shopping season in full swing could help buoy the economy.
Weekly sentiment among consumers in the U.S. Midwest was the lowest since July, as were respondents with at least a college education
Comfort among black consumers rebounded to an eight-week high
Confidence was weakest since April among Americans separated, widowed or divorced