January 2, 2006

Consumer Confidence Remains High

After rebounding in November, The Conference Board Consumer Confidence Index maintained its momentum by improving further in December. The index now stands at 103.6, which is up from 98.3 in November and its highest levels since Hurricane Katrina struck the Gulf Coast at the end of August.

The Present Situation Index surged to 121.5 from 113.2. The Expectations Index increased to 91.6 from 88.4 last month. The Consumer Confidence Survey is based on a representative sample of 5,000 U.S. households.

"The resiliency of the economy, recent declines in prices at the pump, and job growth have consumers feeling more confident at year-end than they felt at the start of 2005,” says Lynn Franco, director of The Conference Board Consumer Research Center. “Even though all of the improvement over the past 12 months has been in consumers' assessment of current conditions, and expectations remain below earlier levels, consumers are confident that the economy will continue to expand in 2006."

The outlook for the labor market did not change. Those expecting more jobs to become available in the next six months was virtually unchanged at 14.3 percent vs. 14.1 percent a month ago. Those expecting fewer jobs was also virtually unchanged at 18.0 percent vs. 18.1 percent in November. The proportion of consumers anticipating their incomes to increase in the months ahead declined to 20.6 percent from 21.3 percent last month.

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