Consumer confidence fell short of expectations in December, largely due to Americans’ assessment of the economic outlook for the coming year.

The expectations index, which includes the near-term outlook for income, business and labor market conditions, fell 12.6 points to 81.1 in December, the largest month-on-month decline since November 2020.

Overall, the consumer confidence index reading for December was 104.7, below the 113.2 reading economists surveyed by Bloomberg had expected.

“Consumers’ views of current labor market conditions have continued to improve in line with recent labor market and unemployment data, but their assessment of business conditions has weakened,” Dana Peterson, chief economist at the Conference Board, said in the release. “Compared to the previous month, consumers were significantly less optimistic in December about future business conditions and income. “In addition, pessimism about the future employment outlook has returned, following cautious optimism in October and November.”

In December, 21.3% of respondents expected fewer jobs to be available in the next six months, down from 17.9% the previous month. Meanwhile, expectations for income declines and worsening business conditions over the next six months also rose.

Markets, which have recently been in a downturn amid rising concerns about uncertainty over 2025 policies from the Trump administration and the Federal Reserve, fell after the release.

All three major indexes quickly hit their session lows before beginning to pare their losses.