Consumer confidence still on edge/Richmond mfr'g

The January Conference Board’s Consumer Confidence index was 104.1, down from 109.5 in December and just below the estimate of 105.7. Of note is that figure is less than the pre election figure of 109.6 in October and the 112.8 print seen for November. So, whatever election bump we got has given it back for reasons seen below.

Internally, the Present Situation component fell about 10 pts m/o/m to a 4 month low and Expectations were lower by 2.6 pts m/o/m to 83.9 after touching 93.7 in November. That is also a 4 month low. Maybe one of the reasons, one year inflation expectations rose 2 tenths m/o/m to 5.3%, matching the highest since June 2024. The Conference Board said “references to inflation and prices continue to dominate write-in response.”

We Wall Streeters and financial followers get excited about a slowdown in the rate of change in inflation but consumers still have a financial headache from its absolute level.

Also a drag were the answers to the labor market questions. Those that said jobs were Plentiful fell 4.1 pts to a 4 month low and those that said jobs were Hard To Get rose almost 2 pts to a 3 month high. Also, those expecting ‘more jobs’ in the coming 6 months fell .4 pts m/o/m to 19.4 after printing 22.8 in November. Expectations for an increase in income dropped by .7 pts to 18.3, the lowest since July.