Consumer confidence beat expectations in May but still dropped from April.
The University of Michigan’s consumer confidence index rose to 90.7 from a preliminary reading of 88.6, but fell from a 95.9 reading in April.
Expectations were for the reading to come in at 89.5, up from 88.6 earlier this month, a number that was a big disappointment.
In a release, Richard Curtin, chief economist for the report said:
Although the loss in confidence narrowed in late May, the decline for the month as a whole was still substantial as consumers have adopted more modest prospects for a rebound following the economy’s dismal 1st quarter performance. The decline was widespread among all age and income subgroups as well as across all regions of the country. Despite the May decline, in the first five months of 2015, the Sentiment Index has averaged 94.6. The last year that the average level of the Sentiment Index was higher was in 2004, when it averaged 95.2. Overall, the latest data are still consistent with a 3% annual growth rate in real personal consumption expenditures during 2015.
Earlier on Friday, we got a revised GDP number that showed the economy contracted at an annualized pace of 0.7% in the first quarter, and we also got figures out of the Midwest that showed economic contraction in that region of the country.