NEW YORK (MNI) – The following is the text of the RBC Capital
Markets summary of its latest monthly consumer confidence survey,
published Thursday:

Most Americans believe a combination of spending cuts and tax
increases are necessary to balance the federal budget

NEW YORK, December 2, 2010 – Registering the highest reading since
September 2008, the RBC Consumer Outlook Index increased 3.2 points to
45.2 in December (42.0 in November) as a result of improved current
conditions, employment security, expectations and investment attitudes.
Consumer confidence has been on the rise for three months in a row and
has broken through the top of the recent range. However, despite the
recent improvements in consumer sentiment, the RBC index remains well
below its long-term average of 50 points and continues to reflect a very
modest economic recovery.

“Consumers are entering the holiday season with greater hope and
optimism than at any point since September 2008 – just before the global
financial crisis hit a fever pitch-closing out 2010 on a high note,”
said Marc Harris, Co-Head of Global Research at RBC Capital Markets.
“Although the RBC Consumer Outlook Index witnessed a sharp improvement
this month, it still reads below the long-term average, which is in line
with what we believe will continue to be a backdrop of cautious consumer
spending.”

As Congress reconvenes this week to address a list of national
fiscal issues, most Americans believe the best way for Congress to
balance the Federal budget is through a combination of spending cuts and
tax hikes, according to the monthly RBC Consumer Outlook Index. While
more than two-thirds of Americans (68 percent) believe it will take a
combination of tax increases and spending cuts to close the federal
budget deficit, one-quarter (27 percent) say that spending cuts alone
can balance the budget, and only five percent are confident that tax
increases will be enough to reduce the deficit. Only 10 percent expect
the deficit to shrink in 2011.

Despite the harsh fiscal realities facing the nation, this month
four-in-ten respondents (39 percent) say the country is on the right
track, up from 35 percent last month, and they are beginning to feel
better about their local economies. For the first time this year, more
Americans say their local economies will be stronger in six months (24
percent) than weaker (20 percent), and the percentage of consumers
rating their current local economy as weak dropped five points to 51
percent, down from 56 percent in November.

In terms of expectations for 2011, 54 percent of respondents
predict inflation will be higher next year, while just nine percent say
it will be lower. However, regarding the outlook for unemployment and
the stock market in 2011, U.S. consumers are mixed. Thirty-five percent
of respondents predict unemployment will go higher, while 25 percent say
it will decrease and 30 percent say it will remain at its current level.
One-quarter (26 percent) predict the stock market will go up while 24
percent say it will go lower. Interestingly, 38 percent of consumers
currently invested in the stock market expect it to go higher next year.

Consumers also are more confident about employment security for
themselves and those in their inner circle. The number of people
reporting that someone they know has lost a job in the past six months
dropped to 43 percent – the lowest reading in 2010. Consumers reporting
they are more confident about job security jumped seven points this
month, while those who are less comfortable dropped three points.

About The RBC Consumer Outlook Index

The RBC U.S. Consumer Outlook Index provides the most up-to-date
and comprehensive outlook of U.S. consumers based on data collected from
interviews with a nationally representative sample of more than 1,007
U.S. adults conducted over a multi-day polling period each month by
Ipsos, the world’s second-largest market and opinion research firm. The
results in this news release reflect some of the findings of the Ipsos
poll of 1,032 U.S. adults conducted November 19-22, 2010. The RBC
Consumer Outlook Index is released within 36 hours after the U.S. online
panel members are interviewed. Weighting is employed to balance
demographics and ensure that the survey sample’s composition reflects
that of the U.S. adult population according to Census data and to
provide results intended to approximate the sample universe.

Last month, the RBC Consumer Outlook Index was re-scaled to
correspond with a 0-100 scale in order to maximize the interpretability
of month-to-month and year-over-year changes in consumer outlook. The
Consumer Outlook Index is still based on the same set of underlying
questions and continues to capture the same sense of American consumer
confidence. The new bounded range for the RBC Consumer Outlook Index
produces more controlled monthly fluctuations, which enables greater
ability to diagnose meaningful changes across the time series. Re-scaled
scores have been calculated retroactively for all historical data. The
historical mean for the rescaled Consumer Outlook Index COI is 50. This
indicates that a score over 50 represents above-average consumer
confidence and a score below 50 represents below-average consumer
confidence.

** Market News International New York Newsroom: 212-669-6430 **

[TOPICS: M$U$$$,MAUDS$]