Consumer confidence dips in January

NEW YORK (Reuters) - Consumer confidence fell in January, with shoppers turning more negative on current business conditions and their assessment of the job market, a new survey showed on Tuesday.

The Conference Board said its index of consumer sentiment fell to 87.9 from an upwardly revised 90.6 in December.

The median forecast of economists polled by Reuters was for a reading of 87.5.

Lynn Franco, director of the Board's consumer research center, said "consumers are quite downbeat about the short-term future and a greater proportion expect business conditions and employment to deteriorate further in the months ahead."

"The percentage of consumers anticipating an improvement in their earnings has declined and could potentially impact spending decisions," Franco said.

The present situation Index rose to 115.3 in January from an upwardly revised 112.9 in December, while the expectations index fell to 69.6 from an upwardly revised 75.8.

The bond market briefly extended price losses following the release of the data, while stocks were little impacted.

"Until the job market weakens noticeably, confidence will be weak but it won't unravel -- consumers are very nervous so it won't take much to lose faith," said Mark Zandi, chief economist at Moody's Economy.com in West Chester, Pennsylvania.

Investors are focusing on key jobs data for January, to be released on Friday, following surprisingly weak U.S. nonfarm payrolls data for December.