The Conference Board’s Consumer Confidence Index Declines in January

The Conference Board, a non-partisan, not-for-profit think tank founded in 1916, released today (1-31-23) its Consumer Confidence Index® (CCI) for January 2023. The CCI declined to 107.1 (1985=100) in January. This follows and upwardly revised level of 109.0 for December.

The Present Situation Index—based on consumers’ assessment of current business and labor market conditions—increased to a reading of 150.9 in January, up from its December reading of 147.4.

The Expectations Index—based on consumers’ short-term outlook for income, business, and labor market conditions—fell to a reading of 77.8 (1985=100) in January, down from 83.4, partially reversing its December gain. The Expectations Index is below 80, which often signals a recession with the next year.

Both the Present Situation and Expectation Indexes were revised up slightly for December.

Adding additional background information and his analysis to the release of the CCI for January, Dr. Ataman Ozyildirim, Senior Director of Economics at the Conference Board, said:

“Consumer confidence fell the most for households earning less than $15,000 and for households aged under 35. Consumers’ assessment of present economic and labor market conditions improved at the start of 2023. However, the Expectations Index retreated in January reflecting their concerns about the economy over the next six months. Consumers were less upbeat about the short-term outlook for jobs. They also expect business conditions to worsen in the near term. Despite that, consumers expect their incomes to remain relatively stable in the months ahead. Meanwhile, purchasing plans for autos and appliances held steady, but fewer consumers are planning to buy a home—new or existing. Consumers’ expectations for inflation ticked up slightly from 6.6 percent to 6.8 percent over the next 12 months, but inflation expectations are still down from its peak of 7.9 percent last seen in June.”