Despite strong holiday sales, Americans were slightly more pessimistic about the economy in December than they were in November.
But looked at year-over-year consumer confidence remained relatively stable from December 2009 to December 2010.
On Tuesday The Conference Board released its monthly Consumer Confidence Index, which showed that confidence decreased slightly in December, after rising in October and November. The Index stands at 52.5, down from 54.3 in November, below expectations. The Consumer Confidence Survey is based on a representative sample of 5,000 U.S. households.
“Despite this month's modest decline, consumer confidence is no worse off today than it was a year ago,” said Lynn Franco, Director of the Consumer Research Center at The Conference Board, in a statement. “Consumers' assessment of the current state of the economy and labor market remains tepid, and their outlook remains cautious. Thus, all signs continue to suggest that the economic expansion will continue well into 2011, but that the pace of growth will remain moderate.”
Consumers claiming business conditions are "bad" decreased to 41.2% from 42.9%, while those claiming business conditions are "good" declined to 7.5% from 8.5%. Consumers’ are also more pessimistic about the labor market. Those saying jobs are "plentiful" decreased to 3.9% from 4.3%, while those stating jobs are "hard to get" increased to 46.8% from 46.3%.
Consumers’ expectations of the future decreased as well from November. Those expecting an improvement in business conditions over the next six months increased to 16.6% from 16.4%, while those anticipating business conditions will worsen fell to 12.1% from 12.4%. Sentiment about job prospects were also mixed. Those anticipating fewer jobs in the months ahead increased to 19.5% from 19.1%, while those expecting more jobs declined to 14.3% from 15.1%.
Yet despite consumers’ lack of confidence in the economy they continued to spend. What does that mean for 2011 and beyond?