Job Market, Gas Prices Hurt Consumer Confidence

Job Market, Gas Prices Hurt Consumer Confidence

Rising gasoline prices and high unemployment caused a widely watched index of U.S. consumer confidence to weaken in January.

The Thomson Reuters/University of Michigan preliminary index of consumer sentiment dropped to 72.7 from 74.6 in December. Economists cited unemployment rates that remain above 9 percent and gas prices that the American Automobile Association said averaged $3.10 per gallon on Thursday, the highest since October 2008.

By The Numbers: U.S. Diesel Prices.

The confidence survey’s gauge of current conditions, which reflects Americans’ perceptions of their financial situation and whether it is a good time to buy big-ticket items, decreased to a three-month low of 79.8 from 85.3 in December. The index of consumer expectations for six months from now increased to 68.2, the highest since June 2010, from 67.5.

Consumers in the survey said they expect an inflation rate of 3.3 percent over the next 12 months, the highest since October 2008. Consumers surveyed in December expected 3 percent.

-- Contact Joseph Bonney at jbonney@joc.com.