Consumer confidence at 5-year high, but 'cliff' looms
The final November index of consumer sentiment stood at 82.7 based on the widely followed survey by Thomson Reuters/University of Michigan. That's a notch above the 82.6 reading for October, but down from the 84.9 preliminary index earlier in November.
Details of the report released Wednesday showed consumers' mood about current conditions brightened in November, most likely reflecting the improving housing market and gains in job growth in October.
But consumers were less upbeat about expectations for the future, signaling greater awareness and caution about a fiscal cliff of higher taxes and federal spending cuts at the start of next year, unless lawmakers take action to avert what most analysts believe will lead the nation into recession.
The latest report comes just two days before the traditional start of the holiday shopping season. Surveys suggest that the Christmas retail season will likely match last year's performance, but sales could disappoint if consumers become increasingly nervous that the nation could go over the fiscal cliff.
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