US DATA
Consumer confidence unexpectedly pulled back in December after reaching a 3-year high in November, with the Conference Board's index dropping to a 3-month low 104.7 (113.2 survey) from 112.8 (rev from 111.7). This was largely down to expectations fading, to 81.1 from 93.7; "present situation" was fairly steady, dipping to 140.2 from 141.4.
- However, the closely-watched labor differential metric (jobs plentiful minus jobs hard to get) improved for the 3rd consecutive month to 22.2 from 18.4, for the highest reading since May. That included 37% saying jobs were "plentiful", and just under 15% saying jobs were "hard to get", respectively the highest and lowest since May.
- We don't take great signal from the headline confidence figures, as they are volatile (the latest reading being impacted by concerns over potential government policy shifts including tariffs), and the level is broadly consistent with continued robust consumption rather than any change in trend.
- But the labor market differential continues to point to a cooling but not rapidly deteriorating labor market. Overall it suggests that the trend increase in the unemployment rate will remain fairly slow.
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