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The fiscal cliff may have sunk consumer confidence. The Conference Board’s consumer confidence index fell in December, following a slight decline in November. The index now stands at a reading of 65.1 (1985=100), down from 71.5 in November.
“Consumers’ expectations retreated sharply in December resulting in a decline in the overall index,” said Lynn Franco, director of economic indicators at The Conference Board. “The sudden turnaround in expectations was most likely caused by uncertainty surrounding the oncoming fiscal cliff. A similar decline in expectations was experienced in August of 2011 during the debt ceiling discussions. While consumers are quite negative about the short-term outlook, they are more upbeat than last month about current business and labor market conditions.”
The number of consumers anticipating more jobs in the months ahead declined to 17.0 percent in December from 19.5 percent in November, according to the index's survey.