A monthly measure of consumer confidence has dropped for a third straight month in part as a response to a temporary government shutdown.
The Conference Board reported its Consumer Confidence Index fell 6.4 points to 120.2 in January. The index has dropped more than 16 points from October, when the reading stood at its highest level in nearly 18 years.
“Shock events such as government shutdowns tend to have sharp, but temporary, impacts on consumer confidence,” said Lynn Franco, senior director of economic indicators at the Conference Board. “Thus, it appears that this month’s decline is more the result of a temporary shock than a precursor to a significant slowdown in coming months.”
The business research and membership association bases the index on the results of monthly household surveys. Economists monitor the index because consumer spending accounts for more than two-thirds of economic activity in the country.
For January, the present situation component of the index edged down three-tenths of a point to 169.6.
The proportion of consumers responding to the survey upon which the January index was based who described business conditions as “good” remained unchanged at 37.4 percent. The share of those who characterized conditions as “bad” fell a half point to 11.1 percent.
The proportion of consumers who said jobs are “plentiful” increased 1.1 points to 46.6 percent. But the share of those who said jobs are “hard to get” also increased — seven-tenths of a point to 12.9 percent.
The expectations component of the index dropped 10.4 points to 87.3.
The share of consumers who said they expect business conditions to improve over the next six months fell 2.1 points to 16 percent. The proportion of those anticipating worsening conditions rose 4.2 points to 14.8 percent.
The share of consumers expecting more jobs to become available in coming months fell 1.9 points to 14.7 percent. The proportion of those anticipating fewer jobs rose 1.9 points to 16.5 percent.
While 18.2 percent of consumers said they expect their incomes to improve — down 4.2 points — 7.1 percent said they anticipate less income, down a half point.