December 03, 2008

Recession reports – US consumer confidence slides

Reuters reported that US consumers' confidence plunged to a five year low this month on worries over rising inflation and fewer jobs, with a record drop in home values in January providing additional cause for their woes.

According to two closely watched Standard & Poor's Case Shiller gauges, prices of existing US single family homes slumped about 11% YoY in January 2008 from the same month in 2007.

A report by the Conference Board showed consumer expectations for the future were at a 34 year low in March and anxieties over job prospects and inflation at their highest since the aftermath of Hurricane Katrina in late 2005.

The Board said its index of consumer sentiment fell in March to 64.5 the lowest since March 2003 from an upwardly revised 76.4 in February.

Mr Nigel Gault chief US economist at research consultancy Global Insight at Waltham in Massachusetts said that "These are dramatic declines with all the bad news hitting consumers. It's hard to say anything positive for the consumers."