U.S. Consumer Confidence Hits 10-Year Low

Consumer confidence, influenced strongly by the Persian Gulf War, plunged in January to its lowest level in 10 years, the Conference Board said today.

The private business research organization’s Consumer Confidence Index dropped to 54 in January, down from the 61.3 recorded in December. The January reading is just above that recorded during the bottom of the 1980 recession. The index was set at 100 in 1985.

“Last month’s drop in confidence probably can be attributed almost entirely to the crisis in Iraq,” said Fabian Linden, executive director of the board’s Consumer Research Center. “Survey results recorded in the first half of January were down sharply as last-minute peace negotiations failed.”

After the U.S.-led attack on Iraq, Americans became somewhat more optimistic in their expectations for the immediate future, the board said.