Consumer Confidence Index Falls Nearly 15 Points

Press release from the issuing company

February 26, 2003 -- The Conference Board's Consumer Confidence Index declined sharply in February, the third consecutive monthly decline. The Index now stands at 64.0 (1985=100), down from 78.8 in January, an almost 15-point drop. The Expectations Index fell to 65.6 from 81.1. The Present Situation Index dropped to 61.6 from 75.3. The last time the Consumer Confidence Index was lower was in October of 1993 when it reached 60.5. The survey by The Conference Board, a not-for-profit research organization, is released on the last Tuesday of every month at 10 AM (ET). It is based on a representative sample of 5,000 U.S. households. The monthly survey is conducted for The Conference Board by NFO WorldGroup, a member of The Interpublic Group of Companies (NYSE: IPG). “Lackluster job and financial markets, rising fuel costs, and the increasing threat of war and terrorism appear to have taken a toll on consumers,” says Lynn Franco, Director of The Conference Board’s Consumer Research Center. “This month’s confidence readings paint a gloomy picture of current economic conditions, with no apparent rebound on the short-term horizon.” Consumers' assessment of current conditions turned extremely bleak. Those rating current business conditions as "bad" rose to 30.7 percent from 26.7 percent. Those holding the opposite view declined to 13.2 percent from 15.0 percent. Consumers’ expectations for the next six months were also considerably more pessimistic than last month. Those anticipating that business conditions will worsen increased to 19.0 percent from 14.0 percent. Those anticipating an improvement fell to 15.3 percent from 17.7 percent. Jobs ‘Hard to Get’ at a Nine-Year High The employment outlook was grim. Consumers reporting jobs are hard to get rose to a nine-year high of 30.1 percent from 28.9 percent. Those claiming jobs are plentiful decreased to 11.2 percent from 14.5 percent. Consumers anticipating fewer jobs to become available in the next six months surged to 28.4 percent from 21.2 percent. Those expecting more jobs fell to 12.7 percent from 14.2 percent. The proportion of consumers anticipating an increase in their income dropped to 15.2 percent, an all-time low, from 18.4 percent.