US consumer confidence jumps in December as outlook improves

Consumer confidence in the US jumped in December, according to the Conference Board, as perceptions of current and future conditions turned more optimistic.

The closely watched monthly release of the consumer confidence index rose to 110.7 this month, up from 101.0 in November, which was revised down from initial estimates.

However, the consensus estimate was for a reading closer to 104.5.

The Conference Board said the Present Situation Index increased to 148.5 from 136.5, with 21.7% of consumers rating business conditions as "good" compared with 18.6% the month before.

The Expectations Index rose to a five-month high of 85.6 from 77.4. Consumer perceptions about the short-term outlook for business conditions, the labour market and income prospects all improved from November.

Meanwhile, the perceived likelihood of a recession in the US over the coming 12 months fell to its lowest level seen this year, though two-thirds of consumers said a downturn was still possible in 2024.

"December's increase in consumer confidence reflected more positive ratings of current business conditions and job availability, as well as less pessimistic views of business, labor market, and personal income prospects over the next six months," said Dana Peterson, chief economist at the Conference Board.

"December's write-in responses revealed the top issue affecting consumers remains rising prices in general, while politics, interest rates, and global conflicts all saw downticks as top concerns."