Consumer Confidence Falls Further in December

U.S. consumer confidence continues to fall as global pandemic fatigue sets in and genuine relief still seems far away. Despite a slight correction and stability throughout the summer months, the composite value of consumer confidence, reported by The Conference Board, has now slipped repeatedly during the fourth quarter from 101.8 in September to 88.8 in December. The three-month moving average (3MMA) fell to 94.3 in December compared to 98.5 in November. The 3MMA dipped notably from the recent high of 130.4 in February and 127.0 year over year. Since this indicator is quite volatile, the moving average is used to reduce monthly variability; however, consumer confidence is clearly on a downward move entering 2021.

“Consumers’ assessment of current conditions deteriorated sharply in December, as the resurgence of COVID-19 remains a drag on confidence,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board. “As a result, consumers’ vacation intentions, which had notably improved in October, have retreated. On the flip side, as consumers continue to hunker down at home, intentions to purchase appliances have risen. Overall, it appears that growth has weakened further in Q4, and consumers do not foresee the economy gaining any significant momentum in early 2021.”