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Consumer confidence holds steady in Florida despite 'cliff'

By Palm Beach Business.com

DELRAY BEACH — Consumer confidence held steady among Floridians in December but dropped sharply nationally, according to separate reports released Thursday.

The University of Florida’s statewide consumer confidence index for December came in at 74, same as the revised number for November. The Conference Board’s national index slipped 6.4 points to 65.1.

The impasse in Congress over the budget — the so-called fiscal cliff — affected both surveys. If a deal can’t be reached, tax rates will rise and mandatory budget cuts will be imposed automatically.

“In November there was a clear reaction to the outcome of the election with confidence among Democrats increasing and confidence among Republicans decreasing,” UF Survey Director Chris McCarty said.  “In December that is still true with confidence among Republicans at 49 and among Democrats at 103, about the same as November.  This month confidence has also been affected by increased media attention focused on the fiscal cliff.”

McCarty said the looming cliff mostly affected expectations for the near-term; longer term — five years out — Floridians are actually more optimistic.

Lynn Franco of the Conference Board said the results of the December survey mirror those of August 2011 when Standard & Poors down rated U.S. debt over the inability of Congress to strike a deal on the debt ceiling. Still, not all is negative.
“While consumers are quite negative about the short-term outlook, they are more upbeat than last month about current business and labor market conditions,”  Franco said.