Consumer confidence declined to a new all-time low of 38 (1985=100) in December after posting a modest increase the previous month when it stood at 44.7, according to a report released yesterday by The Conference Board. The Board’s Present Situation Index fell to 29.4 in December compared with 42.3 last month and its Expectations Index declined to 43.8 this month compared with 46.2 in November.

“The further erosion of the Consumer Confidence Indexâ„¢ reflects the rapid and steep deterioration of economic conditions that occurred in the fourth quarter of 2008,” said Lynn Franco, director of The Conference Board Consumer Research Center. “The Present Situation Index is now close to levels last seen in the months following the 1990-91 recession, but is not as low as levels reached during the 1981-82 recession. Declines in the Expectations Index appear to be moderating, but this index continues to hover at historical lows.

“Both sub-indexes bear careful watching over the next several months to see if they are starting to show signs of approaching a bottom,” she said. “In the meantime, however, the overall economic outlook remains quite dismal for the first half of 2009, and only a modest recovery is expected in the second half.”

Consumers’ claiming business conditions are “bad” increased to 46 percent in December compared with 40.6 percent the previous month. Consumers saying jobs are “hard to get” rose to 42 percent this month from 37.1 percent in November, according to the report. Those anticipating business conditions to worsen over the next six months increased to 32.8 percent in December from 28.3 percent last month; consumers expecting conditions to improve rose to 13.4 percent from 11.5 percent in November.