US Consumer Confidence Increased in January

Wednesday, January 31st, 2024

The Conference Board Consumer Confidence Index® rose in January to 114.8 (1985=100), up from a revised 108.0 in December. The reading was the highest since December 2021, and marked the third straight monthly increase. The Present Situation Index—based on consumers' assessment of current business and labor market conditions—surged to 161.3 (1985=100) from 147.2 last month. The Expectations Index—based on consumers' short-term outlook for income, business, and labor market conditions—improved to 83.8 (1985=100) in January, up from a revised reading of 81.9 in December.

"January's increase in consumer confidence likely reflected slower inflation, anticipation of lower interest rates ahead, and generally favorable employment conditions as companies continue to hoard labor," said Dana Peterson, Chief Economist at The Conference Board. "The gain was seen across all age groups, but largest for consumers 55 and over. Likewise, confidence improved for all incomes groups except the very top; only households earning $125,000+ saw a slight dip. January's write-in responses revealed that consumers remain concerned about rising prices although inflation expectations fell to a three-year low. Buying plans dipped in January, but consumers continued to rate their income and personal finances favorably currently and over the next six months. Consumers' Perceived Likelihood of a US Recessionover the Next 12 Months continued to gradually ease in January, consistent with an Expectations Index rising above 80."

Peterson added: "Assessments of the present situation rose in January, buoyed by more positive views of business conditions and the employment situation. Furthermore, when asked to assess their current family financial conditions(a measure not included in calculating the Present Situation Index), the proportion reporting 'good' increased while those saying 'bad' fell. This suggests consumers are starting off the year in good spirits about their current finances."

"Consumer expectations for the next six months increased slightly in January, due to receding pessimism around futurebusiness conditions, labor market, and income prospects. Expectations that interest rates will rise in the year ahead plummeted to just 41.5 percent. Consumers expecting stock prices to be higher in the year ahead retreated slightly after surging in December but remained near three-year highs. Average 12-month inflation expectations fell to 5.2 percent, the lowest since March 2020 (4.5 percent). Consumers' views of their expected family financial situation, six months hence (not included in calculating the Expectations Index) were slightly more tempered in January but remained on net optimistic. On a month-to-month and six-month basis, buying plans for autos, homes, and big-ticket appliances declined slightly for all three categories."

Present Situation
Consumers' assessment of current business conditions was more positive in January.

  • 22.5% of consumers said business conditions were "good," up from 21.1% in December.
  • 14.2% said business conditions were "bad," down from 17.2%.

Consumers' appraisal of the labor market was also more positive in January.

  • 45.5% of consumers said jobs were "plentiful," up from 40.4% in December.
  • 9.8% of consumers said jobs were "hard to get," down from 13.1%.

Expectations Six Months Hence     
Consumers were, on balance, slightly less optimistic about the short-term business conditions outlook in January.

  • 16.6% of consumers expect business conditions to improve, down from 18.7% in December.
  • However, only 16.0% expect business conditions to worsen, down from 17.8%.

Consumers' assessment of the short-term labor market outlook was slightly less pessimistic in January.

  • 16.0% of consumers expect more jobs to be available, down from 17.6% in December.
  • 15.3% anticipate fewer jobs, down from 18.4%.

Consumers' assessment of their short-term income prospects was, on balance, less pessimistic in January.

  • 16.4% of consumers expect their incomes to increase, down from 18.3% in December.
  • 11.5% expect their incomes to decrease, down from 13.6%.

Assessment of Family Finances and Recession Risk

  • Consumers' assessment of their Family's Current Financial Situation was more positive in January.
  • Consumers remained optimistic in rating their Family's Expected Financial Situation, Six Months Hence.
  • Consumers' Perceived Likelihood of a US Recession over the Next 12 Months continued to abate in January.

The monthly Consumer Confidence Survey®, based on an online sample, is conducted for The Conference Board by Toluna, a technology company that delivers real-time consumer insights and market research through its innovative technology, expertise, and panel of over 36 million consumers. The cutoff date for the preliminary results was January 22.

Source: January 2024 Consumer Confidence Survey®
The Conference Board

The Conference Board publishes the Consumer Confidence Index® at 10 a.m. ET on the last Tuesday of every month. Subscription information and the technical notes to this series are available on The Conference Board website: