Consumers less upbeat in July – survey
NEW YORK (Reuters) – U.S. consumer confidence slipped in
July from three-year highs reached in June as consumers took a
more mixed view of their job prospects, a report said on
The Conference Board said its gauge of consumer sentiment
fell to 103.2 from a revised 106.2 in June. Analysts had looked
for a reading of 106.0 in July.
“Consumer confidence was softer than expected in July,”
said Gary Thayer, chief economist at A.G. Edwards and Sons in
St. Louis. “It looks as if consumers were a little bit more
concerned about their job prospects.”
The portion of consumers surveyed saying jobs were “hard to
get” in the survey rose to 23.8 percent from 22.5 percent, but
those saying jobs were “plentiful” held firm at 22.5 percent.
Economists said that confidence still looked solid though.
“Overall, confidence is still at a healthy level, up from
where it was a year ago, though we did pull back a bit from the
three-year high that we saw in June,” Thayer said.
Lynn Franco, director of the Conference Board’s Consumer
Research Center, said the July decline in consumer confidence
was no cause for concern.
“The overall state of the economy remains healthy and
consumers’ outlook suggests no storm clouds on the short-term
horizon,” Franco said. “Even the steady upward tick of fuel
prices at the pump has done relatively little to dampen
The research group’s present situation reading fell to
118.5 in July from 120.8 in June while its expectations index
measure fell to 93.0 in July from 96.4.
Consumer spending is the backbone of the U.S. economy,
accounting for two-thirds of activity, and changes in
confidence are seen as a possible precursor to softer or
In recent years, however, the correlation between
confidence and retail sales has weakened, with consumers
purchasing cars and homes even as they tell surveys that things
are getting worse.