Consumer Confidence Lowest Since 2002
Washington, D.C. Confidence in the economy dropped to a new low as worries about a possible recession, persistent problems in the housing and credit markets and lofty energy prices put people in more gloomy mind-sets.
According to the RBC Cash Index, confidence sank to a mark of 33.1 in early March, down from 48.5 in February. The new reading was the worst since the index began in 2002 and surpassed the previous low reached in February.
The big worry is that consumers will cut back sharply on their spending, throwing the economy into a tailspin.
However, the nation’s retailers that reported sales results on Thursday did get a bit of a reprieve. Shoppers cautiously returned to malls, after retrenching in recent months. Among the big winners: discounters such as Wal-Mart Stores, whose results beat expectations.
Still, as retailers reported mixed February sales results, it was clear that shoppers weren’t splurging but rather focused on necessities, like groceries and low prices. Among the weakest performers were apparel stores such as Gap, Limited Brands and J.C. Penney.