A man pets a dog outside the Tiffany & Co. store on Rodeo Drive in Beverly… (Patrick Fallon / Bloomberg…)
WASHINGTON -- Despite some recently improving economic data, consumer confidence dropped in August to its lowest level since late last year, according to a leading indicator released Tuesday.
The Conference Board's consumer confidence index fell to 60.6 this month, from 65.4 in July, driven not by what people feel about the current situation but their concerns about where the economy is headed. The reading was the lowest since November.
The index had ticked up in July after four monthly declines. But with talk of the fiscal cliff looming at the end of the year -- a potentially recession-inducing mix of tax increases and large government spending cuts -- the index resumed its downward trend in August.
"A more pessimistic outlook was the primary reason for this month's decline in confidence," said Lynn Franco, director of economic indicators at the Conference Board.
There was little change in how consumers viewed their current situation. For example, 34.4% of people surveyed said business conditions right now were bad, the same percentage as in July. And 40.7% of those surveyed in August described jobs as "hard to get," down slightly from 41% a month earlier.
But consumers' long-term view headed south. The percentage of respondents who expected business conditions to improve over the next six months dropped to 16.5%, from 19% in July. And 23.4% of those surveyed in August said they expected the economy to produce fewer jobs in the same upcoming period, up from 20.6%.
Despite those concerns, consumers indicated they were more optimistic about their own earning power. The percentage of respondents who expected to see their incomes rise during the next six months improved to 15.7% in August, from 14.2% in July.
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