Consumer confidence drops to lowest level since November 2011

Consumer confidence continued to slip in January, falling to its lowest level since November 2011, the Conference Board said Tuesday.

The group’s monthly Consumer Confidence Index fell to 58.6 in January, down 8.1 points from the month before.

“Consumer confidence posted another sharp decline in January, erasing all of the gains made through 2012,” said Lynn Franco, director of economic indicators, in a statement. “Consumers are more pessimistic about the economic outlook and, in particular, their financial situation.”

The drop in consumer confidence, according to the group, is attributed to a hike in the payroll tax that kicked in this year.

Americans saw slightly smaller paychecks in 2013 as the new payroll tax rate kicked in.

The index, based on a compilation of consumer polls, found that those claiming business conditions are “good” declined from 17.2% to 16.7%. On the labor market front, those claiming jobs were “plentiful” declined to more than 2 points to 8.6%.

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