WASHINGTON – U.S. consumer confidence tumbled in December, driven lower by fears of sharp tax increases and government spending cuts set to take effect next week.
The Conference Board's consumer confidence index fell to 65.1 this month from 71.5 in November. That's the lowest level since August. The outlook for the next six months deteriorated to its lowest level since 2011.
Lynn Franco, the board's director of economic indicators, blames the worsening outlook on the "fiscal cliff," the name for automatic spending cuts and tax hikes that take effect Jan. 1 if the White House and Congress can't reach a budget deal. Expectations also plunged in August 2011 when a fight over the federal debt limit brought the government to the brink of insolvency.