Consumer Confidence Slips 2 Points, Remains Very High in June

The Conference Board Consumer Confidence Index ticked down in June following a big gain in May and now stands at 126.4 (1985=100), down from 128.8. The Present Situation Index was relatively flat, 161.1 versus 161.2 last month, while the Expectations Index declined from 107.2 last month to 103.2 this month.

“Consumer confidence declined in June after improving in May,” said Lynn Franco, Director of Economic Indicators at The Conference Board. “Consumers’ assessment of present-day conditions was relatively unchanged, suggesting that the level of economic growth remains strong.”

Consumers’ appraisal of current conditions was essentially unchanged in June.

“While expectations remain high by historical standards, the modest curtailment in optimism suggests that consumers do not foresee the economy gaining much momentum in the months ahead,” Franco added.

The percentage stating business conditions are “good” fell slightly from 38.6% to 36.0%, while those saying business conditions are “bad” also fell from 12.6% to 11.7%.

Consumers’ views of the labor market was also mixed. The percentage of consumers claiming jobs are “plentiful” ticked down from 42.1% to 40.0%, but those claiming jobs are “hard to get” also fell, from 15.6% to 14.9%.

Consumers’ optimism about the short-term outlook cooled in June.

The percentage of consumers anticipating business conditions will improve over the next 6 months declined from 23.3% to 21.4%, while those expecting business conditions will worsen increased from 7.8% to 9.8%.

However, consumers’ outlook for the labor market was slightly more favorable.

The proportion expecting more jobs in the months ahead increased somewhat from 19.7% to 20.0%, while those expecting fewer jobs declined from 13.1% to 12.6%. On short-term income prospects, the percentage of consumers expecting an improvement declined from 21.4% to 18.8%, while the proportion expecting a decrease rose from 8.0% to 8.7%.

The monthly Consumer Confidence Survey, based on a probability-design random sample, is conducted for The Conference Board by Nielsen. The cutoff date for the preliminary results was June 15.