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WASHINGTON, Dec 27 AFP

December 28 2012, 03:52AM

US consumer confidence fell sharply in December to its lowest level since August amid uncertainty about the "fiscal cliff" crisis, the Conference Board says.

The closely-watched monthly survey said the consumer confidence index dipped to 65.1, a drop from a downwardly revised 71.5 in November. Analysts had expected the December figure to be 70.0.

December's figure is the lowest since August, when it stood at a revised 61.3.

Lynn Franco, the Conference Board's director of economic indicators, said consumers' expectations had retreated sharply in December, resulting in a decline in the overall index.

"The sudden turnaround in expectations was most likely caused by uncertainty surrounding the fiscal cliff," Franco said in a statement.

With an end-of-year deadline just days away, politicians in Washington have yet to strike a deal to keep stiff tax hikes and drastic budget cuts from taking effect next month.

Experts say going over the "cliff" could take the world's biggest economy back into recession.

Franco added that a similar decline was experienced in August 2011 during debt ceiling discussions in Washington.

"While consumers are quite negative about the short-term outlook, they are more upbeat than last month about business and labour market conditions," Franco said.

Consumers who assessed business conditions as "good" rose to 17.1 per cent from 14.6 per cent, while those viewing them as "bad" slipped from 31.2 per cent to 27.3 per cent.

However, the percentage of consumers expecting business conditions to improve over the next six months dipped from 21.3 per cent to 17.6 per cent. Those expecting conditions to worsen climbed from 15.8 per cent to 21.5 per cent.