(Photo: Reuters)
The Survey of Consumers, a closely-watched gauge of consumer sentiment from the University of Michigan, fell to 94.3 in June, down slightly from a reading of 94.7 in May. The median forecast anticipated a reading of 94.0 for the month.
“Consumers were a bit less optimistic in early June due to increased concerns about future economic prospects,” said Surveys of Consumers chief economist, Richard Curtin. The recent data magnified the growing gap between the most favorable assessments of Current Economic Conditions since July 2005, and renewed downward drift of the Expectations Index, which fell by a rather modest 8.6% from the January 2015 peak.”
| Jun | May | Jun | M-M | Y-Y | |
| 2016 | 2016 | 2015 | Change | Change | |
| Index of Consumer Sentiment | 94.3 | 94.7 | 96.1 | -0.4% | -1.9% |
| Current Economic Conditions | 111.7 | 109.9 | 108.9 | +1.6% | +2.6% |
| Index of Consumer Expectations | 83.2 | 84.9 | 87.8 | -2.0% | -5.2% |
Next data release: June 24, 2016 for Final June data at 10am ET
More from Curtain:
The strength recorded in early June was in personal finances, and the weaknesses were in expectations for continued growth in the national economy. Consumers rated their current financial situation at the best levels since the 2007 cyclical peak largely due to wage gains. Prospects for gains in inflation-adjusted incomes in the year ahead were also the most favorable since the 2007 peak, enabled by record low inflation expectations. On the negative side of the ledger, consumers do not think the economy is as strong as it was last year nor do they anticipate the economy will enjoy the same financial health in the year ahead as they anticipated a year ago. A sustained reduction in the pace of job creation could prompt consumers to hold down spending to increase their precautionary savings. Overall, the data still indicate that real consumer expenditures can be expected to rise by 2.5% in 2016 and 2.7% in 2017.
