The Conference Board reported today that consumer confidence in the US rose this month following back-to-back monthly declines in October and November.

The Consumer Confidence Index now stands at a reading of 108.3 (1985=100), up from 101.4 in November.

In addition, the Present Situation Index — based on consumers’ assessment of current business and labor market conditions — increased to 147.2 this month from 138.3 in November.

The Expectations Index — based on consumers’ short-term outlook for income, business and labor market conditions — improved to 82.4 this month from 76.7 in November. However, expectations are still lingering around 80 — a level associated with recession.

“Consumer confidence bounced back in December, reversing consecutive declines in October and November to reach its highest level since April 2022,” said Lynn Franco, senior director of economic indicators at The Conference Board. “The Present Situation and Expectations Indexes improved due to consumers’ more favorable view regarding the economy and jobs.”

Franco noted that inflation expectations retreated in December to their lowest level since September 2021, with recent declines in gas prices a major impetus.

“Vacation intentions improved, but plans to purchase homes and big-ticket appliances cooled further,” Franco said. “This shift in consumers’ preference from big-ticket items to services will continue in 2023, as will headwinds from inflation and interest rate hikes.”

Appraisal of the labor market was also more favorable, as 47.8% of consumers said jobs were plentiful, up from 45.2% in November. In addition, 12.0% of consumers said jobs were hard to get, down from 13.7% last month.

Consumers were also more upbeat about the short-term labor market outlook. While 19.5% of consumers expect more jobs to be available, up from 18.5% in November, 18.3% anticipate fewer jobs, down from 21.2%.