Consumer spending will weaken in the months ahead.
Although firms did expect a slightly slower pace of growth, they still judge overall economic conditions quite favorable.
Restoring consumer confidence becomes more than just a matter of economic stimulus. A renewal in confidence may also require the restoration of a sense of personal safety among large parts of the population.
High gas prices had a devastating impact on consumers' budgets and caused consumers to expect a worsening financial situation during the year ahead.
That certainly is part of the issue. People have stakes (in the stock market) have noticed these things. If you get to the top quarter or the top 10 percent, then these consumers have mentioned decline in stock market prices much more often.
Consumers have become increasingly pessimistic about their future income and job prospects, and as a result will continue to slow the pace of their spending during months ahead.
The highest proportion of consumers in two decades anticipate a falling unemployment rate in 2004.
On average, consumers have anticipated changes in the unemployment rate three quarters in advance of the actual change.
The last time consumer confidence declined a comparable extent was prior to the recessions in 1990 and 1980.
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