Consumer confidence in the United States edged down in January on concerns over the economy in the coming months and less optimism on the jobs outlook, according to survey data released Tuesday.
The retreat comes as efforts to cool the world’s biggest economy start to bite, with inflation and wage gains showing signs of ebbing.
The closely watched consumer confidence index ticked down more than expected to 107.1 in January, down from a revised 109.0 reading in December, said think tank The Conference Board.
“Consumer confidence declined in January, but it remains above the level seen last July,” said Ataman Ozyildirim senior director of economics at The Conference Board.
It fell the most for households earning less than $15,000 and for households aged under 35, he added.
While the start of the year saw an improvement in consumers’ assessment of current economic and labor market conditions, the expectations index went lower in January.
This reflects “concerns about the economy over the next six months,” Ozyildirim said.
Consumers were less upbeat about the short-term outlook for jobs, and also expect business conditions to worsen in the near term, he added.
The expectations index fell below a reading of 80, which typically signals a recession within the next year, said The Conference Board’s report.
But the expectation is that incomes will remain relatively stable in the months ahead, with fewer people planning to buy a home.
“Consumer attitudes are not yet showing significant improvement, even as inflation is easing, and job growth remains strong,” said economist Rubeela Farooqi of High Frequency Economics.
“Slower job growth and diminishing savings going forward could be a constraint for households,” she said.