Americans’ Economic Confidence Wavers in June

Last updated: June 26, 2024

American dollars in bundlesConsumer confidence in the US showed a slight decline in June, reflecting growing caution among Americans about the future, according to recent data released Tuesday. The Conference Board’s latest index dropped to 100.4 from May’s revised figure of 101.3, aligning with economists’ expectations.

Despite ongoing economic expansion and a robust job market, concerns over persistent inflation and high interest rates have eroded consumer optimism.

Economists from Wells Fargo highlighted a cautious yet resilient consumer sentiment, noting a mixed outlook on current economic conditions versus future prospects.

The survey also indicated varied confidence levels across economic sectors. While the present situations index saw a modest uptick to 141.5, indicating improved perceptions of current conditions, the expectations index fell to 73. This marks the fifth consecutive month below 80, a level the Conference Board views as a potential recession signal.

The Federal Reserve’s upcoming data on Personal Consumption Expenditures will provide critical insights into inflation trends, influencing future economic outlooks.

Ian Shepherdson, chief economist at Pantheon Macroeconomics, interpreted the latest consumer confidence figures as indicative of slowing consumption growth and a gradual rise in unemployment.

As the US presidential election approaches, consumer sentiment remains pivotal, given that consumer spending drives nearly 70% of economic activity. The balance between robust job growth and inflation concerns will likely continue shaping consumer confidence in the months ahead.

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