By Shobhana Chandra Nov. 13 (Bloomberg) -- Confidence among U.S. consumers unexpectedly fell in November for the second consecutive month as surging unemployment shook households. The Reuters/University of Michigan preliminary index of consumer sentiment decreased to 66 from 70.6 in October. The gauge was projected to rise, according to the median forecast in a Bloomberg News survey of economists. A jobless rate that jumped to a 26-year high last month and is projected to remain above 10 percent through the first half of next year is weighing on Americans as they head into the holiday shopping season. Macy’s Inc. is among retailers showing a decline in sales as consumers spend only on essentials such as food and clothing. “It’ll be a lackluster holiday season as consumers are staying cautious,” Guy LeBas, chief fixed-income strategist and economist at Janney Montgomery Scott LLC in Philadelphia, said before the report. “The labor market is really problematic. It’s going to cap confidence and limit opportunities for growth in spending.” The index was forecast to rise to 71, according to the median of 69 economists surveyed by Bloomberg. Estimates ranged from 67.5 to 75. During the expansion that began in late 2001 and ended in December 2007, the index averaged 89.2. A report from the Commerce Department today showed the trade deficit widened by 18 percent in September, the most in a decade, reflecting rising demand for imported oil and automobiles as the economy rebounded. The gap grew to $36.5 billion, larger than anticipated and the highest level since January. Imports surged by the most in 16 years, swamping a gain in exports.

Source