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Although the holiday season has arrived, U.S. consumers are not feeling very merry, according to the most recent results of the RBC CASH (Consumer Attitudes and Spending by Household) Index. The survey, which measured the attitudes of 1,009 Americans earlier this week, found that consumer sentiment remained low, but stable, following a significant drop in November. While Americans' expectations for future prospects and their confidence in jobs improved slightly, their evaluations about current conditions and investments continued to decline. As a result of these mixed sentiments, the RBC CASH Index for December 2007 stands at 65.9, compared to 64.0 in November.
"Consumer sentiment remains stuck at very low levels," said T. J. Marta, Economic and Fixed Income Strategist for RBC Capital Markets. "Consumers have been seeing high gasoline and oil prices, a struggling stock market and falling housing sales and prices. And now they see worrisome headlines that financial companies thought to have been safe from the subprime mortgage debacle are running into trouble."
The RBC CASH Index is a monthly national survey of consumer attitudes on the current and future state of local economies, personal finance situations, savings and confidence to make large investments. The Index is composed of four sub-indices: RBC Current Conditions Index; RBC Expectations Index; RBC Investment Index; and, RBC Jobs Index. The Index is benchmarked to a baseline of 100 assigned at its introduction in January 2002. This month's findings are based on a representative nationwide sample of 1,009 U.S. adults polled from December 3-5, 2007 by survey-based research company Ipsos Public Affairs. The margin of error was plus or minus 3.1 per cent. Highlights of the survey results include:

  -   After free-falling into negative territory in November, Americans'
      expectations regarding future economic conditions inched up this
      month. The RBC Expectations Index for December stands at a tepid 7.9,
      up 12 points from -4.3 last month. This month, 22 per cent of
      consumers report they expect their local economy to be stronger
      six months from now, compared to 19 per cent in November, while
      one quarter (25 per cent) expect their local economy to be weaker in
      six months, compared to 27 per cent last month. Job loss expectations
      also contributed to the improvement, as those reporting future job
      loss is likely declined slightly this month to 16 per cent, compared
      to 19 per cent in November.

  -   The RBC Current Conditions Index slipped again this month reaching
      85.3, down 5 points from November's 90.3 level, and down more than
      15 points from October when it stood at 101.1. A decline in
      Americans' comfort with making household purchases was the main
      driver behind the decline, a potentially troubling sign for retailers
      during this holiday shopping season. Consumers' comfort level for
      making household purchases dipped to 32 per cent in December from
      34 per cent last month, and their discomfort level reached
      49 per cent this month, compared to 47 per cent in November.

  -   The RBC Jobs Index registered a small gain this month, reaching
      113.9, compared to 111.8 in November, as Americans' concerns over job
      security stabilized. Personal job loss experience in December
      decreased by two points, with 33 per cent of consumers reporting job
      loss in their immediate circle, compared to 35 per cent last month.
      Americans reporting no personal job loss in their immediate circle
      also increased two points, reaching 66 per cent this month, compared
      to 64 per cent in November.

  -   Consumers' views of the investment climate continued to cool in
      December bringing the RBC Investment Index down another four points
      to 79.7, compared to 83.4 last month. While consumer comfort levels
      for future investments held steady at 37 per cent, and the percentage
      of Americans reporting they are less confident in investing remained
      unchanged from November's 46 per cent, the decline in consumers'
      perceptions of their personal finances and their comfort level in
      making household purchases contributed to the decline in the RBC
      Investment Index.

About RBC
Royal Bank of Canada (RY on TSX and NYSE) and its subsidiaries operate under the master brand name of RBC. We are Canada's largest bank as measured by assets and market capitalization and one of North America's leading diversified financial services companies. We provide personal and commercial banking, wealth management services, insurance, corporate and investment banking, and transaction processing services on a global basis. We employ approximately 70,000 full- and part-time employees who serve more than 15 million personal, business, public sector and institutional clients throughout offices in Canada, the U.S. and 36 other countries.
For more information, visit rbc.com.