Consumer confidence slips in US
Posted: Monday, July 2, 2012 9:02 pm
By: ANNE D’INNOCENZIO AP Retail Writer
By ANNE D’INNOCENZIO
AP Retail Writer
NEW YORK (AP) — Americans can’t seem to shake their uneasy feeling about the economy.
Consumer confidence fell in June for the fourth straight month in a row as lingering worries about the economy outweighed relief at the gas pump.
The Conference Board said last week its Consumer Confidence Index is now at 62, down from 64.4 in May and the 63.2 analysts were expecting.
The index remains well below the 90 reading that indicates a healthy economy — a level it hasn’t been near since the recession began in December 2007. But it’s far from the all-time low of 25.3 reached in February 2009.
The indicator is widely watched because consumer spending, including major items like health care, accounts for 70 percent of U.S. economic activity. Americans are still worried about slow hiring, their home values, the stock market and a worsening European economy that some fear will hurt the U.S.
“Consumers were somewhat more positive about current conditions, but slightly more pessimistic about the short-term outlook,” said Lynn Franco, director of Economic Indicators at the Conference Board in a statement. “If this trend continues, spending may be restrained in the short-term.”
Worries about job and income growth was a big concern in the survey, which is based on a poll conducted from June 1 through June 14 with about 500 randomly selected people nationwide.
Those stating jobs are “hard to get” increased to 41.5 percent from 40.9 percent.
Those expecting more jobs in the months ahead declined to 14.1 percent from 15.4 percent. Meanwhile, the proportion of consumers expecting an increase in their incomes declined to 14.8 percent from 15.7 percent.
Consumers’ dwindling confidence in job growth reflect that after solid gains during the first three months of the year, there’s been a sharp slowdown in hiring in April and May. Meanwhile, a measure of the number of people applying for unemployment benefits over the past month has reached a six month high, the government said. That increase suggests that layoffs are rising and June could be another lackluster month for hiring.
The government is slated to release June data this week.
Still, Americans have some reasons to be optimistic. A widely watched home price index, released last week, offered some hope for the housing market. Home prices rose in nearly all major U.S. cities in April, according to The Standard & Poor’s/Case-Shiller home price index. That’s the second straight month that prices have risen in a majority of U.S. cities.