Stimulus package fails to boost consumer confidence

With most taxpayers having received their stimulus checks, a new report on Tuesday shows that the much-touted plan to revive the economy has not met with enthusiasm from consumers.

The New York-based Conference Board announced that its consumer confidence index has fallen to the fifth-lowest level in the more than 40 years since it was established.

{mosads}“Consumers’ assessment of present-day conditions continues to grow more negative and suggests the economy remains stuck in low gear,” said Lynn Franco, director of the Conference Board Consumer Research Center. “Perhaps the silver lining to this otherwise dismal report is that consumer confidence may be nearing a bottom.”

Franco told The Hill that the “one-time, temporary” fix of the rebate checks is being outweighed by the burden of high gas and food prices.

“It will take a variety of different remedies to get confidence back on track,” Franco said when asked what Congress could do to rebuild consumer confidence.

The short-term outlook is even bleaker than consumers’ views of present-day conditions.

The group’s expectations index, which measures how consumers think the economy will do within the next six months, reached its lowest level ever.

The survey, which is based on a representative sample of 5,000 households, found that only 8.8 percent of consumers think that business conditions will improve until the end of the year. Meanwhile, 33.9 percent believe they will worsen.

Historically, this is bad news for the party holding the White House, according to Franco, because bad economic conditions make consumers yearn for a change.