UBS PaineWebber conducted a survey with the Gallup Organization that showed consumer confidence in the economy hit a four-year low in April.
Souring business conditions and general job insecurity are to blame for the pessimistic outlook, according to the survey, released May 1.
Analysts and Fed officials closely watch consumer confidence, particularly in times of economic uncertainty. Confidence can affect consumer spending, which accounts for about two-thirds of economic growth, according to Lynn Franco, director of Consumer Research Center’s Conference Board.
Job market worries amid mounting corporate layoffs--not stock market jitters--accounted for most of the April fall in confidence, Franco says.
The survey was conducted before the Federal Reserve Board’s interest cut of 50 basis points in April. The Fed cut the rate again on Tuesday.
Consumers, however, did remain resilient in some areas, as retail sales at discount, chain and department stores rose in the first two weeks of April, according to the survey.
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