January 12, 2021 – After a decline to 92.9 in November, the Conference Board headline Consumer Confidence Index decreased further to 88.6 in December, led by a precipitous decline of 15.6 points in the present situation component. All consumer optimism is about the future—the expectations component rose 3.2 points to 87.5, with more consumers saying business conditions will improve in the next six months.
The dichotomy in the consumer mood about the present and future likely centered around both health and economic issues. Surveys for the first release were concluded on December 14, the same day that vaccinations were first given in the U.S., and prior to Congress passing the next round of economic stimulus. Consumers have yet to see the impact of vaccinations, but expect improvement as that happens in the coming months. Possible evictions and bills due once forbearance and deferrals end have worn on consumers’ view of the present. Stimulus fund distribution should positively impact consumers’ ability to weather the continued economic storm and boost spending in early 2021.