A key measure of consumer attitude has dropped to its lowest level in two years – and that’s not good news for the upcoming holiday shopping season.
The New York-based Conference Board said yesterday that its Consumer Confidence Index fell from a revised 99.5 during September to 95.6, the lowest reading since 85.2 during October 2005 after Gulf Coast hurricanes Katrina and Rita caused gas and oil prices to soar.
The report is less than encouraging to retailers hoping to attract holiday shoppers who already face higher food and gas prices, a deepening housing slump and tighter credit.
And, even though the Federal Reserve is expected to cut interest rates today in an effort to boost the economy, many analysts say the reduction will come too late to rescue the shopping season.
Consumer confidence indicators are a big deal to economists because consumer spending accounts for two-thirds of the nation’s economic activity.