US consumer confidence has fallen to its lowest level in 16 years while US home prices fell in April at the fastest rate in years, two economic reports have said.
The news is the latest sign that the US economy continues to slide towards possible recession. Consumer expectations fell to 50.4 points this month from 58.1 in May, the lowest level since February 1992 and a steeper decline than expected, according to a survey by the Conference Board, a private industry group. Financial experts have blamed tight credit conditions, falling housing wealth, rising gasoline prices and the nation's increasing unemployment rate for the confidence slump. Bleak outlookMeanwhile housing prices in all 20 US cities tracked by the Standard & Poor's/Case-Shiller home price index showed annual declines at levels not seen since August 2004. The index's smaller 10-city index fell 16.3 per cent in April, the largest decline in its two-decade history. "Looking ahead, consumers' economic outlook is so bleak that the expectations index has reached a new all-time low," Lynn Franco, consumer research director at the Conference Board, told AFP. "Perhaps the silver lining to this otherwise dismal report is that consumer confidence may be nearing a bottom." The reports coincided with the opening of a two-day meeting held by the US central bank, the Federal Reserve, to discuss interest rates, which are expected to be left unchanged in a decision to be released on Wednesday. The US Federal Reserve has cut interest rates by 3.25 percentage points since last September in a bid to stave off the nation's growing housing and credit crises.