Industry News

Consumer confidence hits two-year low

Spending expected to pick up in latter half of 2008

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Falling home prices and the rising cost of fuel and food helped push consumer confidence to the lowest level in two years, according to a monthly survey by Reuters and the University of Michigan. The Index of Consumer Sentiment was 76.1 in the November 2007 survey, down from 80.9 in October and 92.1 a year ago. That's still above the level that might indicate an impending recession, but could mean growth in  consumer spending will nearly grind to a halt in the closing months of 2007 and inthe first few months of 2008, said Richard Curtin, director of the Reuters/University of Michigan Surveys of Consumers. "The engine of consumer spending is expected to sputter at the turn of the year but not stall, and slowly gain speed in the last half of 2008," Curtain said. The chance of a recession hinges on how low home prices ultimately sink and how far fuel prices climb, Curtin said in a press release. He said media accounts of foreclosures have made consumers more sensitive to cred...