After reporting a sharp drop in U.S. consumer confidence in the previous month, the Conference Board released a report on Tuesday showing that confidence unexpectedly saw further downside in November.
The Conference Board said its consumer confidence index dipped to 70.4 in November from an upwardly revised 72.4 in October.
The decrease came as a surprise to economists, who had expected the index to climb to 72.9 from the 71.2 originally reported for the previous month.
Lynn Franco, Director of Economic Indicators at the Conference Board, said, "Sentiment regarding current conditions was mixed, with consumers saying the job market had strengthened, while economic conditions had slowed."
The report said the present situation index edged down to 72.0 in November from an upwardly revised 72.6 in October.
Consumers saying business conditions are "good" edged up to 19.9 percent from 19.5 percent, while those saying conditions are "bad" rose to 25.2 percent from 23.0 percent.
With regard to the labor market, consumers saying jobs are "plentiful" edged up to 11.8 percent from 11.6 percent, and those saying jobs are "hard to get" dipped to 34.0 percent from 34.9 percent.
"When looking ahead six months, consumers expressed greater concern about future job and earning prospects, but remain neutral about economic conditions," Franco said. "All in all, with such uncertainly prevailing, this could be a challenging holiday season for retailers."
The Conference Board said the expectations index fell to 69.3 in November from 72.2 in October, extending the sharp decline seen in the previous month.
Consumers expecting business conditions to improve over the next six months ticked up to 16.6 percent from 16.0 percent, while those expecting business conditions to worsen decreased to 16.8 percent from 17.5 percent
However, the outlook for the labor market was more pessimistic, with those expecting more jobs in the months ahead falling to 12.7 percent from 16.0 percent. Consumers expecting fewer jobs also decreased to 21.7 percent from 22.6 percent.
The Conference Board said the proportion of consumers expecting their incomes to increase fell to 14.9 percent from 15.7 percent, while those expecting their incomes to decrease inched up to 15.9 percent from 15.5 percent.
Peter Boockvar, chief market analyst at the Lindsey Group, said, "Bottom line, confidence didn't rebound after the government shutdown/debt ceiling induced drop in October which may be due in part to the new government worry in November about keeping one's health insurance."
Wednesday morning, Thomson Reuters and the University of Michigan are scheduled to release their final report on consumer sentiment in the month of November.
Economists expect the final reading on the consumer sentiment index for November to come in at 73.3 compared to the preliminary reading of 72.0.
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