A business confidence index for Massachusetts posted a 47.8 reading for December, up one point from the previous month’s reading as local companies kept a watch on the fiscal cliff debate in Washington, D.C.
The monthly index, maintained by the Associated Industries of Massachusetts, or AIM, uses a 100 point scale. A reading above 50 suggests a positive outlook among employers in the Bay State that make up AIM’s membership. A reading below 50 suggests a pessimistic outlook by the local business community.
“The small uptick presumably reflects optimism in the course of the month that we would avoid the ‘fiscal cliff,’ “Raymond G. Torto, chair of AIM’s Board of Economic Advisors, said in a statement. “Nevertheless, the Index recouped very little of prior months’ losses and is down 3.2 from its level in December 2011.”
The fiscal cliff refers to the mix of federal tax increases and spending cuts that were set to take effect at the beginning of the month if Congress and President Obama could not work out a compromise. The two sides were able to work out a deal on some issues, but delayed action on many others until later in the year.
The AIM index took its December snapshot before Congress and the president reached a last-minute agreement on tax issues while choosing to temporarily put off major decisions on spending.