One wonders what our economy will look like in four years.
U.S. consumer confidence unexpectedly dropped for the first time in three months in early January as stock prices fell and oil prices crept up, a report today showed.
The University of Michigan’s preliminary consumer sentiment index for the month decreased to 95.8 from 97.1 in December, as expectations for the future dimmed. A measure of present conditions, tied closest to spending, rose to a four-year high.
The median forecast of 61 economists surveyed by Bloomberg News called for the Michigan index to rise to 97.5. Forecasts ranged from a low of 94 to a high of 102.5.
The dollar fell against the euro after the report, with a euro bringing $1.3008 as of 10:21 a.m. in New York, compared with $1.2963 yesterday. The 4 1/4 percent Treasury note maturing in November 2014 was unchanged to yield 4.16 percent.
The economy also may not be adding enough jobs fast enough to kindle widespread optimism. “For sentiment to break out of its recent range, sustained and substantial gains in jobs are needed,” said Steven A. Wood, president of Insight Economics LLC in Danville, California.
The average gain in non-farm payrolls last year of about 185,000 jobs a month “is not a fantastic performance,” Janet Yellen, president of the Federal Reserve Bank of San Francisco, said yesterday. Even so, she said, the U.S. economy is in a “self- sustaining expansion” and the labor market “is finally firming up.”