Consumer Confidence Retreats [AUDIO]
After two months of large gains, consumer confidence was down in January.
The Conference Board is reporting that its Consumer Confidence Index now stands at 61.1, down from a revised 64.8 in December. Economists had expected a reading of 68. From October to December, the index had surged from 40.9 to 64.8.
"Until consumers really see some sort of sustainable trend when it comes to job growth, it's hard for them to believe that the recovery is underway," said Lynn Franco, Director of the Consumer Research Center at The Conference Board. "They also need to see some income gains. They're still facing these challenges as we go ahead and because of these challenges, they're going to be cautious in terms of spending."
"Basically, the consumer we saw in 2011 is the same consumer we're seeing in 2012," said Franco. "It's going to be a slow recovery. In all likelihood, unless the economy continues to grow at a very fast clip, we're not likely to generate employment growth that's going to satisfy and get us to certain encouraging levels very quickly."
"It's going to take proof before consumers actually believe and that will take several months of sustainable job growth," she said. "Rising gas prices also have taken a toll on sentiment. That uptick at the gas pumps definitely effects consumers who are on a budget. It gives consumers this diminished sense of purchasing power."