US Consumers Increasingly Pessimistic, Signals of Another Recession?
US consumer confidence weakened again in January, falling to its lowest point in more than a decade, signaling that households are increasingly pessimistic about the direction of the economy and job opportunities. The Conference Board's confidence index, released on Tuesday (January 27), fell to 84.5 from 94.2 the previous month, marking the weakest level since May 2014 and also lower than all economists' projections in the survey.
This decline is not just a matter of sentiment. The six-month expectations index also fell, while assessments of current conditions plunged to their lowest level in nearly five years. After a slight improvement in December, sentiment has weakened again due to concerns about persistently high prices and a slower pace of job creation. Many economists predict the job market this year will likely be "flat": openings are less brisk than last year, but not yet leading to a wave of massive layoffs.
Among respondents' accounts, the most frequent theme was the cost of living—from oil and gasoline prices to groceries. Politics, the job market, and health insurance were also mentioned more frequently. The survey's job market indicators also turned yellow: the share of consumers saying "jobs are hard to find" rose to its highest level since early 2021, while those feeling "jobs are plentiful" fell. The gap between the two—a measure often used to gauge job market strength—narrowed to its worst point in years.
Interestingly, the picture isn't entirely uniform. A separate sentiment survey from the University of Michigan actually rose to a five-month high in January, as some citizens felt their economic and personal financial situation was improving. This means that at the public level, there are two stories: cost-of-living pressures remain, but some people are starting to see hope—although Conference Board data suggests confidence remains fragile.
Source: Newsmaker.id
