U.S. Consumer Confidence Tanks

Way below Wall Street forecasts

Amid weakening business and job market conditions 2007, U.S. consumer confidence tanked in September to almost a two-year low, the Conference Board said Sept. 25.

The business research company said its consumer confidence index fell to 99.8, down from a revised 105.6 in August. The confidence reading was sharply below Wall Street forecasts of 104.5 and was at its lowest since hitting 98.3 in November 2005. Last month the index dropped from 111.9 in July.

"Weaker business conditions combined with a less favorable job market continue to cast a cloud over consumers and heighten their sense of uncertainty and concern," said Lynn Franco, the group's research director. "Looking ahead, little economic improvement is expected, and with the holiday season around the corner, this is not welcome news."

In the survey, the percentage of consumers claiming conditions were "good" fell to 25.7% from 26.2% in August and those saying conditions were "bad" rose to 17.9% from 16.3%. The percentage who said jobs are "plentiful" declined to 25.7% from 27.5% while respondents saying jobs are "hard to get" rose to 22.1% from 19.7%.

The confidence index is closely watched by the markets as an indicator of consumer spending, which accounts for roughly two-thirds of U.S. economic activity.

Copyright Agence France-Presse, 2007

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