The Conference Board’s consumer confidence index fell to 80.3 in July.
Economists polled by Bloomberg were looking for consumer confidence to moderate to 81.3.
Consumer confidence for June was however revised up to 82.1.
The headline is based on consumers perceptions of both current business and employment conditions, and their expectations six months into the future. Investors watch this number because it offers insight into consumer spending.
The Conference Board Consumer Confidence Index®, which had improved in June, pulled back slightly in July. The Index now stands at 80.3 (1985=100), down from 82.1 in June. The Present Situation Index increased to 73.6 from 68.7. The Expectations Index decreased to 84.7 from 91.1 last month.
The monthly Consumer Confidence Survey®, based on a probability-design random sample, is conducted for The Conference Board by Nielsen, a leading global provider of information and analytics around what consumers buy and watch. The cutoff date for the preliminary results was July 18.
Says Lynn Franco, Director of Economic Indicators at The Conference Board: “Consumer Confidence fell slightly in July, precipitated by a weakening in consumers’ economic and job expectations. However, confidence remains well above the levels of a year ago. Consumers’ assessment of current conditions continues to gain ground and expectations remain in expansionary territory despite the July retreat. Overall, indications are that the economy is strengthening and may even gain some momentum in the months ahead.”
Consumers’ appraisal of current conditions continues to improve. Those stating business conditions are “good” increased to 20.9 per cent from 19.4 per cent, while those stating business conditions are “bad” decreased to 24.5 per cent from 24.9 per cent. Consumers’ assessment of the job market was also more positive. Those claiming jobs are “plentiful” increased to 12.2 per cent from 11.3 per cent, while those claiming jobs are “hard to get” declined to 35.5 per cent from 37.1 per cent.
Consumers’ expectations regarding the short-term outlook weakened in July. The percentage of consumers expecting business conditions to improve over the next six months decreased to 19.1 per cent from 21.4 per cent. However, those expecting business conditions to worsen remained virtually unchanged at 11.2 per cent.
Consumers’ outlook for the labour market was less upbeat. Those anticipating more jobs in the months ahead declined to 16.5 per cent from 19.7 per cent, while those anticipating fewer jobs increased to 18.1 per cent from 16.1 per cent. The proportion of consumers expecting their incomes to increase decreased moderately to 15.3 per cent from 15.9 per cent; however those expecting a decrease declined to 13.8 per cent from 14.2 per cent.
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