by: MATT OTT AP Business Writer
Posted: December 22, 2020 / 10:34 AM EST / Updated: December 22, 2020 / 10:34 AM EST
SILVER SPRING, Md. (AP) – A closely watched indicator of U.S. consumer confidence fell to 88.6 in December as rising coronavirus cases drove American optimism to its lowest level since summer.
The mounting pessimism spreads during the crucial holiday season, which could hit or destroy a number of retailers, restaurants, gyms and other pandemic-hit locations.
The December number released by the Conference Board on Tuesday represents a sharp drop from the November reading, which has been revised down to 92.9. The decline was far worse than analysts expected and is a ominous sign for retailers with Christmas around the corner.
Consumer confidence is closely monitored by economists and investors as it can signal how willing or able US households are to spend. Consumer spending makes up 70% of economic activity in the US
The Department of Commerce reported last week that US retail sales fell 1.1% seasonally adjusted in November. It was the biggest drop in seven months and a steeper drop than Wall Street analysts expected.