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Consumer confidence slides sharply in May

New York -- With consumers paying out more at the pump, and growing increasingly antsy about the labor market, consumer confidence fell sharply during May. It pulled back from a four-year high reached in April and dropped to its lowest level since last year's devastating hurricanes.

The widely watched economic barometer, seen as a harbinger of future consumer spending, fell 6.0% to a reading of 103.2, down from an upwardly revised level of 109.8 in April, The Conference Board reported.

And while consumers say they feel OK about current business conditions, they're growing increasingly pessimistic about conditions six months out. Weighing in on the current situation, consumer sentiment slipped modestly, by 2.7%, to a level of 132.5. But looking six months out, the number of consumers who expect conditions to worsen jumped up to l3.2% from 9.3% in April.

"Consumer confidence, which reached a four-year high in April, lost ground in May," reported Lynn Franco, director of the business think tank's Consumer Research Center. "Apprehension about the short-term outlook for the economy, the labor market and consumers' earning potential has driven the index down to levels not seen since the aftermath of the hurricanes last summer."

The jobs outlook was also more clouded as the number of consumers who expect more jobs to become available slipped to 14.6% from 15.4% the month before. Consumers are also worried that their paychecks won’t be growing. The number who said they expect their income to increase fell to 16.6% from 18.0% in April.

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