Consumer confidence fell to all-time low in October, according to the Conference Board Consumer Confidence Index.
The monthly survey of 5,000 US households reflects the impact of the financial crisis over the last several weeks. The index now stands at 38, down from 61.4 in September. The decline is the third largest in the history of the series, and the current reading is the lowest on record since the inception of the index in 1967.
“The impact of the financial crisis over the last several weeks has clearly taken a toll on consumers’ confidence,” said Lynn Franco, director of The Conference Board Consumer Research Center, in a statement. Consumers’ “earnings outlook, as well as inflation outlook, is also more pessimistic, and this news does not bode well for retailers who are already bracing for what is shaping up to be a very challenging holiday season.”
Consumers’ appraisal of current conditions deteriorated across a variety of segments in October. Those saying business conditions are “bad” increased to 38.3% from 33.4%, while those saying jobs are “hard to get” rose to 37.2% from 32.2% in September. Consumers’ short-term outlook turned significantly more pessimistic. Those expecting business conditions to worsen over the next six months surged to 36.6% from 21%.