Consumer Confidence Declines in November as Inflation Remains a High Concern

Shot of a young businessman looking bored while working at his desk during late night at work.
LumiNola / Getty Images

After an increase in October, consumer confidence decreased in November, and now stands at 109.5, down from 111.6, the Conference Board reported Tuesday, Nov. 30. The Present Situation Index, which is based on consumers’ assessment of current business and labor market conditions, fell to 142.5 from 145.5 last month. The Expectations Index, representing short-term outlook for income, business and labor market conditions also fell, from 89 to 87.6.

See: How Much Do Eggs, Bacon and Other Goods Cost Now Compared to 2020?
Find: 10 Reasons You Should Claim Social Security Early

“Expectations about short-term growth prospects ticked up, but job and income prospects ticked down. Concerns about rising prices — and, to a lesser degree, the Delta variant — were the primary drivers of the slight decline in confidence. Meanwhile, the proportion of consumers planning to purchase homes, automobiles and major appliances over the next six months decreased.” said Lynn Franco, Senior Director of Economic Indicators at the Conference Board.

Make Your Money Work for You

She added that the group expects retailers to do well during the holiday season and that consumer confidence is expected to increase along with the economic expansion, but that both confidence and spending will likely face headwinds from rising prices and potential resurgences of COVID-19 in the coming months.

The new Omicron variant that has emerged in the past week will undoubtedly take its toll on consumer confidence in the coming months as this month’s survey did not have time to fully capture consumer sentiments as it emerged.

Market reactions to the new variant though are enough of a preliminary proxy. Global markets fell upon learning of the new virus variant, and this morning global markets took another tumble amidst a statement from the Moderna CEO that existing vaccines will be less effective against the Omicron variant.

Consumers’ view of the present situation was mixed in November. Their appraisal of current business conditions was less favorable in November. Seventeen percent of consumers said business conditions are “good,” compared to 18.3% in October. Consumers’ assessment of the labor market was moderately more favorable, with 58% of consumers saying jobs were “plentiful” — up from 54.8%.

Make Your Money Work for You

See: Omicron Variant Sees Moderna, Pfizer Stocks Skyrocket as Companies Target 100-Day Vaccine Timeline
Find: Despite Surging Inflation, Unemployment Claims Fall to Historic 52-Year Low

The short-term outlook was a little bleaker, with consumers being less optimistic about the short-term labor market outlook specifically. Twenty-two-point-one percent of consumers expect more jobs to be available in the months ahead, down from 24.4% with 18.9% anticipating fewer jobs, up slightly from 18.7%.

More From GOBankingRates

About the Author

Georgina Tzanetos is a former financial advisor who studied post-industrial capitalist structures at New York University. She has eight years of experience with concentrations in asset management, portfolio management, private client banking, and investment research. Georgina has written for Investopedia and WallStreetMojo. 

Best Bank Accounts of July 2022

Untitled design (1)
Close popup The GBR Closer icon

Sending you timely financial stories that you can bank on.

Sign up for our daily newsletter for the latest financial news and trending topics.

Loading...
Please enter an email.
Please enter a valid email address.
There was an unknown error. Please try again later.

For our full Privacy Policy, click here.