We’re No. 1: U.S. consumer confidence is worst in Far West

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Deepening pessimism in the Western states may have helped undermine the latest U.S. consumer confidence report.

The Conference Board’s July confidence index eased to 46.6 from 49.3 in June, the second straight monthly decline, the economic research group said Tuesday.

Economists had anticipated a July reading of 49.0, so the larger-than-expected slippage was blamed for the rough start to Tuesday’s stock market session.

The board tallies confidence by regions as well as an overall U.S. figure. The regional figures show that consumers’ assessment this month of their ‘present situation’ (the board’s term) dived in the Pacific states to the lowest reading for any region -- surpassing even the gloomy sentiment in the East North Central states, a.k.a. the Great Lakes region.

The present-situation confidence index for the Pacific states (Alaska, California, Hawaii, Oregon and Washington) slumped to 9.9 from 12.4 in June and 18.6 in May. California’s dire state budget outlook undoubtedly registered as a depressant in the consumer survey, which was conducted up to July 21.

What’s more, the Pacific region’s ‘expectations’ index, which measures whether people believe conditions will get better or worse over the next six months, sank to 52.7 this month from 62.4 in June and 74.8 in May.

The 52.7 reading was the lowest for any region except East North Central -- and theirs at least was on the rise, to 48.5 from 41.5 in June.

For the country as a whole, the Conference Board’s expectations index fell to 62.0 in July from 65.5 in June, while the present-situation index slid to 23.4 from 25.0. To illustrate how far confidence has plunged, a year ago the present-situation index was 65.8.

The news wasn’t all bad in terms of people’s expectations. Just 18% of respondents nationwide expect business conditions to get better in the next six months, down from 20.9% in June. But the percentage expecting business conditions to worsen also declined, to 18.9% from 20.4%. The majority -- 63.1% -- believe conditions will stay the same, up from 58.7% in June.

-- Tom Petruno

Image credit: Despair.com