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Last Update: 10-Feb-12 10:24 ET
Consumer Confidence Falls in February
Consumer confidence slipped in the preliminary reading for the February University of Michigan Confidence Index. The index declined from 75.0 in January to 72.5 in February. The Briefing.com consensus expected confidence to fall to 74.0.
The expectations index fell from 69.1 in January to 68.0 in February while the present conditions index dropped to 79.5 from 84.2 in January.
Typically, consumer confidence follows changes in employment, oil prices, equity prices, and media reports.
With substantial improvement in the labor sector, as shown by the best claims level since early 2008, and an equity market that is up 7.4% since beginning of January, we expected consumer confidence to continue to increase in February. The fact that confidence fell, however, will have no bearing on our 2012 outlook.
Trends in consumption closely follow income gains and almost nothing else. According to the February Employment Situation Report, aggregate wages increased 0.4%. That should be enough to keep consumption growth on an upward trend even after the drop in confidence.
The expectations index fell from 69.1 in January to 68.0 in February while the present conditions index dropped to 79.5 from 84.2 in January.
Typically, consumer confidence follows changes in employment, oil prices, equity prices, and media reports.
With substantial improvement in the labor sector, as shown by the best claims level since early 2008, and an equity market that is up 7.4% since beginning of January, we expected consumer confidence to continue to increase in February. The fact that confidence fell, however, will have no bearing on our 2012 outlook.
Trends in consumption closely follow income gains and almost nothing else. According to the February Employment Situation Report, aggregate wages increased 0.4%. That should be enough to keep consumption growth on an upward trend even after the drop in confidence.
