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People buy drinks at a store on a sunny afternoon in Brooklyn on the first day of summer on June 21, 2024 in New York City.
CNN
—
to us Consumer confidence June faltered slightly as Americans grew a little more cautious about the future, new data released Tuesday showed.
The Conference Board’s latest consumer confidence index fell to 100.4 in June from a downwardly revised 101.3 in May. June readings land in line with economists’ expectations.
Measures of Americans’ confidence are generally closely watched Consumer spending It accounts for nearly 70% of US economic activity. But with the US presidential election just a few months away, that importance has grown even more.
“These details reveal a reluctant, but not overly concerned, consumer,” Wells Fargo economists Shannon Seery Crane and Jeremiah Cole wrote in an investor note on Tuesday.
Americans felt good about the labor market, which outweighed concerns about the future; However, consumer sentiment has cooled on current business conditions, noted Dana Peterson, chief economist at the Conference Board.
“However, confidence could weaken as the year progresses if material weaknesses emerge in the labor market,” he said in a statement.
Americans felt different levels of confidence around different areas of the economy.
The Current Situation Index rose to 141.5 (its highest level since March) from 140.8; However, the expectations index fell to 73, marking the fifth straight month below 80, the threshold the Conference Board considers indicative of a recession.
Since March 2022, the index of expectations has been above the recession threshold for only six months as inflation has been on the rise. The Federal Reserve begins A Historical rate tightening campaign.
Inflation has slowed significantly over the past two years, but is still above the central bank’s 2% target. Interest rates are at a 23-year high and have helped dampen demand.
Tuesday’s consumer confidence index reflected that, according to Ian Shepherdson, chief economist at Pantheon Macroeconomics.
“On a line, (the index) is consistent with slower consumption growth and a slower rising unemployment rate,” he wrote.
Conference Board Trust Code and The The University of Michigan’s twice-monthly consumer sentiment index They are two leading measures of consumers’ attitudes toward the current and future strength of the economy.
Although both indexes generally track similarly over time, the Consumer Confidence Index is more influenced by employment and labor market conditions, while the Michigan Sentiment Index places more emphasis on the impact of household finances and inflation.
A preliminary reading of the Michigan index for June, released earlier this month, showed sentiment levels at a seven-month low.
The latest and most important reading on inflation will come on Friday, when the Commerce Department releases personal consumption expenditure price index data for May. The PCE index, the central bank’s preferred measure of inflation, stood at 2.7% in April.
