U.S. consumer confidence hits 1-1/2 year low in January
U.S consumer confidence fell to a 1-1/2 year low in January as a partial shutdown of the government and financial markets turmoil left households nervous about the economy`s near-term outlook.
The drop in confidence reported by the Conference Board on Tuesday mirrors another survey earlier this month showing sentiment tumbling to its lowest level since President Donald Trump was elected more than two years ago, strengthening analysts expectations that the economy was losing momentum.
"There`s no way the Trump economics team forecast of 3 percent growth is going to be accurate this year if consumers` spirits don`t brighten up a little," said Chris Rupkey, chief economist at MUFG in New York. The Conference Board`s consumer confidence index dropped 6.4 points to 120.2 this month, the lowest reading since July 2017. It blamed the third straight monthly decline in confidence on "financial market volatility and the government shutdown," which had left consumers pessimistic about the short-term future.
The longest shutdown in U.S. history ended on Friday when Trump and Congress agreed to temporary government funding - without money for his U.S.-Mexico border wall. According to the nonpartisan Congressional Budget Office, the economy lost about $11 billion during the five-week shutdown.
The cutoff date for the Conference Board`s survey was Jan. 17. Consumers were also less upbeat about the labor market, with the share of those expecting more jobs in the months ahead falling and those anticipating fewer employment opportunities rising.
Trump has said he would be willing to shut down the government again if lawmakers do not reach a deal he finds acceptable on border security.
U.S. financial markets were little moved by the data.
Other data on Tuesday showed the S&P CoreLogic Case-Shiller composite index of home prices in 20 metropolitan areas rose 4.7 percent in November on a year-on-year basis, the smallest gain since January 2015, after advancing 5.0 percent in October.
House price inflation is slowing as demand cools and housing inventory increases. The moderation in house prices, together with an easing in mortgage rates should help support demand and lift the housing market this year after it struggled for much of 2018.
"With the weakness across much of the housing data in 2018, we have seen the pace of house price appreciation moderate across a range of different measures," said Daniel Silver, an economist at JPMorgan in New York.
"The house price data tend to lag many other housing indicators, and some of the more timely indicators have perked up a bit now that mortgage rates have declined over the past couple of months."
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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