Consumer confidence dips
By Janice Chamberlain -- Furniture Today, January 4, 2004
NEW YORK — NEW YORK — A slight drop in December consumer confidence, coupled with a similar slip in consumers' buying plans for big-ticket items, may signal that consumers have mixed emotions about present economic conditions while still looking for better times ahead.
In December, the Conference Board's Consumer Confidence Index was 91.3, down 1.2 points from November's 92.5 mark. The Present Situation Index declined to 73.9 from 81 in November, but the Expectations Index increased 2.8 points to 102.9 from November's 100.1.
December's preliminary numbers also indicate that consumers are more optimistic across the board than they were at this time last year. The overall Consumer Confidence Index in December 2003 was up more than 10 points over December 2002. The Present Situation Index grew 4.3 points from a year ago and the Expectations Index climbed to 102.9 in December 2003 from 88.1 in the final month of 2002.
Looking ahead, 3% of December's survey participants planned to buy a new home in the next six months, the same as in November. A year ago, 3.2% said they expected to purchase a new home within six months.
Buying plans for other big-ticket items also have slipped in the last year. In December 2003, 28% of those surveyed said they planned to buy a major appliance in the next half year, compared with 28.4% in December 2002. A year ago, 7.7% of consumers expected to buy a car in six months, measured against 6% in December 2003.
Regionally, four of the nine areas were up in December from November. The largest increase, 4.9 points, was in the West North Central region. The New England region experienced the greatest plunge, dropping 12.2 points to end at 92 in December.
All nine regions were up substantially from December 2002. New England led the field, with a nearly 30-point jump from year-ago figures.
Lynn Franco, director of the Conference Board's Consumer Research Center, said, "The improvements in consumers' expectations signal healthy economic growth in 2004. Consumers' lackluster assessment of current conditions reflects continuing anxiety about labor market conditions. While consumers expect the job situation to improve, until a significant turnaround takes place, optimism about current-day conditions will continue to lag behind expectations."
The Consumer Confidence Survey is based on a representative sample of 5,000 U.S. households.
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