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US consumer confidence, home prices hit grim records

Wed Dec 31, 2008 2:11pm IST
 
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By Burton Frierson

NEW YORK (Reuters) - The U.S. economy extended its run of record-breaking dismal data on Tuesday, with consumer confidence and home prices registering a pair of grim milestones.

U.S. consumer confidence fell to a record low in December as the worst job market in 16 years hammered sentiment, the Conference Board business research firm said.

The dour sentiment has had a harsh impact on spending. The U.S. holiday shopping season has been the worst since at least 1970 due to the recession, the International Council of Shopping Centers said.

Prices of U.S. single-family homes in October posted a record fall of 18.0 percent from a year earlier, according to the closely watched Standard & Poor's/Case-Shiller Home Price Indices.

Business activity in the U.S. Midwest continued to shrink in December but at a less severe rate than expected, and input prices fell sharply.

The data was the latest reminder that the U.S. economy is in for a tough slog after a year-long recession, which many expect to continue during the first half of 2009.

"Really at this point we are not going to be seeing anything fundamentally positive from the U.S. for the time being," said Michael Woolfolk, senior currency strategist at the Bank of New York Mellon in New York.

On Wall Street, stocks closed higher despite the weak data. U.S. government bonds, which are highly sought after by investors during troubled economic times such as these, also rallied.  Continued...

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