The Consumer Confidence Index in July saw a slight pullback from June’s reading as the short-term expectations index weakened due in part to a less robust outlook for the jobs market six months out.
The index now is at 80.3, down from 82.1 in June. June’s reading was the highest since January 2008, as well as the third consecutive month both the current conditions and expectations for the short-term outlook showed improvement in consumer sentiment. While the current reading of 80.3 is relatively high, it is still below the index reading of 90 that is considered that of a healthy economy. The last time that reading was reached was in December 2007.
So while consumers are still somewhat optimistic about current business and labor market conditions, what changed from last month was their opinion on the jobs front.
Of the two components that comprise the index, the present situations index rose to 73.6 from 68.7, while the expectations index fell to 84.7 from 91.1 in June, according to The Conference Board, which conducts the monthly survey.
Lynn Franco, director of economic indicators at The Conference Board, said, “Consumers’ assessment of current conditions continues to gain ground and expectations remain in expansionary territory despite the July retreat. Overall, indications are that the economy is strengthening and may even gain some momentum in the months ahead.”
For now, consumers who said jobs are “plentiful” rose to 12.2 percent from 11.3 percent. The increase seems marginal when compared with expectations six months out. Of those surveyed, respondents who said they expect more jobs ahead fell to 16.5 percent from 19.7 percent, while those who anticipated fewer jobs rose to 18.1 percent from 16.1 percent.