Consumers feeling less upbeat on recovery - Miami Herald

Consumers feeling less upbeat on recovery - Miami Herald
A key economic measurement -- consumer confidence -- fell sharply in February because of concerns over jobs.

NEW YORK -- (AP) -- Americans' outlook on the economy went into relapse in February. Rising job worries sent a key barometer of confidence to its lowest point in 10 months, raising concerns about the U.S. economic recovery.

The Conference Board said Tuesday its Consumer Confidence Index fell almost 11 points to 46 in February, down from a revised 56.5 in January. Analysts were expecting only a slight decrease to 55. It was the lowest level since the index recorded a 40.8 reading in April 2009.

Using a different scale, a University of Florida survey found that Florida's consumer confidence fell in February by two points to 72, reflecting concerns about unemployment, which is higher statewide than across the nation.

``While national unemployment edged downward in January to 9.7 percent, Florida's unemployment increased to 11.8 percent,'' said Chris McCarty, survey director of UF's Bureau of Economic and Business Research.

``This month Floridians may be coming to terms with the possibility that Florida's economy will not recover at the same pace as other states.''

The two-point decline in the overall index comes on the heels of a five-point increase in January to 74. ``January's index seemed more optimistic than it should have been given the economic climate in Florida,'' McCarty said. ``It's worth noting that January's higher index value was based on data collected prior to the release of unemployment figures for Florida.''

The national Consumer Confidence numbers are a reflection that the nation as a whole may be feeling increasingly pessimistic. They erased three months of improvement and are a big blow to hopes that consumer spending will power an economic recovery. Consumer spending accounts for about 70 percent of U.S. economic activity.

The February reading is a long way from what's considered healthy: A reading above 90 means the economy is on solid footing. Above 100 signals strong growth.

While economists said that heavy snowstorms in many areas of the country that shut down businesses dampened confidence, many believe that the report confirms that consumers aren't feeling the nascent economic recovery.

``More than six months after the recovery started, consumer confidence is still close to a record low,'' said Paul Ashworth, senior U.S. economist at Capital Economics.

The news sent stocks lower, overshadowing retailers' reports that showed stronger holiday profits and a housing report, also released Tuesday, that showed that home prices rose for a seventh straight month in December, a sign of price stability as the U.S. housing market continues its bumpy recovery.

However, the Standard & Poor's/Case-Shiller home price index also showed that five of the 20 index cities, including Miami, New York and Chicago, showed price declines from November to December.

Nationwide, the index rose 0.3 percent from November to December, to a seasonally adjusted reading of 145.87. The index was off 3.1 percent from December last year, nearly matching analysts' estimates that it would fall by 3.2 percent.