Consumer Confidence Drops in February

U.S. consumer confidence fell this month as concerns about unemployment and reliability of company earnings reports dimmed enthusiasm that had been building since September.

The Conference Board’s gauge of sentiment dropped to 94.1 after rising to 97.8 in January. The decline was the first in three months and larger than expected.

More than 80% of those surveyed indicated they were concerned about jobs.

The decline may be a one-time occurrence that reflects doubts about stock values in the wake of revelations about deceptive accounting practices at Enron Corp., analysts said.

Consumers remained optimistic about economic conditions in coming months, and that may boost retailers’ business.

“While consumers see the future as reasonably bright, they live in the present,” said Oscar Gonzalez, an economist at John Hancock Financial Services Inc. in Boston. “They’re worried about their jobs, but at the same time, I think they sense that this mild recession appears to be ending and that will raise their hopes.”

The confidence index sank to a 71/2-year low in November as Americans were reeling from the September terrorist attacks.

Since then, confidence has increased as the U.S. has made progress in the war against terrorism and evidence has built that the economy is rebounding from recession.

February’s gauge of consumer expectations for the next six months fell to 93.6, but it still is the second highest since August. January’s level of 97.6 was the largest since March, when the recession began.

Personal spending grew in the fourth quarter at a 5.4% annual rate, the fastest in almost two years. Americans have the means to spend in coming months.

The amount of refunds sent to taxpayers through Feb. 15 is 15.2% more than it was in the same period last year, Internal Revenue Service figures show.