Americans’ already battered confidence in the economy went into free fall in February, sinking to new lows as consumers grow more fearful over massive job cuts and shrinking retirement accounts.
Fresh economic news out today likely will compound their gloom. Major retailers including Target Corp., Home Depot and Macy’s Inc. reported depressed fourth-quarter results. Another widely watched index showed home prices tumbled by the sharpest annual rate on record, and Federal Reserve Chairman Ben Bernanke said the economy is suffering through a “severe contraction” that’s likely to keep shrinking in the first half of this year.
The New York-based Conference Board said its Consumer Confidence Index, which was down slightly in January, plummeted more than 12 points in February to 25, from the revised 37.4 last month. That was well below the 35.5 level that economists surveyed by Thomson Reuters expected. The index, which had hovered in the high 30s over the past few months, broke new lows since it began in 1967. A year ago, the consumer confidence reading stood at 76.4.