Consumer confidence rose in December due to declining prices, although job losses and falling income continued to weigh on sentiment. The Reuters/University of Michigan Surveys of Consumers said its final index reading of confidence for December rose to 60.1 from November's 55.3.
The index was above economists' expectations of 58.6, according to the median of forecasts in a Reuters poll. December's final reading was the highest since 70.3 in September, and was also above the preliminary index reading, released on December 12, which was 59.1.
"More consumers expected declines in prices than in any other survey since 1960 -- in December, 23 percent expected deflation in the year ahead, three times the level recorded just two months ago." One-year inflation expectations plunged in December to 1.7 percent, the lowest since July 2003, from 2.9 percent in November.
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