U.S. Consumer Confidence Dips in June

The Conference Board's Index of Consumer Confidence fell 0.9% (-8.8% y/y) in June to 100.4 after increasing 3.9% to 101.3 in May, revised from 102.0. The reading fell 5.4% in April to an unrevised 97.5. A June figure of 100.1 had been expected in the Action Economics Forecast Survey. The latest level remains below the high of 137.9 in October 2018 and below the latest high of 114.0 in July of last year.

The component readings were mixed this month. The Present Situations Index rose 0.5% (-8.9% y/y) to 141.5 in June after edging 0.1% higher in May to 140.8, revised from 143.1. The index declined 4.2% in April and 0.5% in March. Offsetting this increase, the Expectations Index fell 2.5% (-8.8% y/y) in June to 73.0 after rising 8.9% in May to a little-revised 74.9. The index fell an unrevised 7.0% in April and 3.0% in March.

A lessened 19.6% of respondents characterized current business conditions as good in June, remaining below its high of 23.4% in June 2023. Labor market readings improved this month. The jobs gap, representing the difference between respondents indicating that jobs are plentiful and those saying jobs are hard to get, rose to 24.0% this month from 22.7% in May. The reading remained below the March 2022 high of 47.1%. Calculated by Haver Analytics, this series has a 61% correlation with the unemployment rate over the last ten years. The jobs plentiful measure rose to 38.1% from 37.0%, but remained below the March 2022 high of 56.7%. The jobs hard-to-get reading of 14.1% compared to 14.3% in May and 15.5% in April. The jobs not-so-plentiful reading fell to 47.8% from 48.7% in May and remained well above its 30.5% low in September 2021.

A reduced 12.5% of consumers believed that business conditions in six months would improve, compared to 13.7% in May. A lessened 16.7% believed they would worsen versus 19.1% just two months ago. A lower 12.6% of respondents felt there would be more jobs in six months, down from 17.6% six months ago and 20.0% in December of 2022. A greatly lessened 15.2% expected income to increase in six months, down from 18.3% in December and below a high of 19.6% in October of 2022.

Inflation expectations have been steady and reduced from their high. The expected inflation rate in twelve months of 5.3% compared to 5.4% in May. It was increased from 5.2% in February but remained below the 7.9% high in June 2022. The reading was above the 4.4% low in January 2020.

A lessened 52.6% of respondents felt that interest rates would be higher in twelve months, compared to a low of 42.1% in January. An increased 21.2% thought they would be lower. A lessened 48.4% of respondents believed that stock prices would be higher in twelve months, but that was increased from a low of 25.5% in July 2022. A greatly lessened 23.5% thought stock prices would be lower in twelve months versus a high of 44.7% in July of 2022. The share of respondents planning to buy a home within six months held steady at 5.2% and remained below the October 2022 high of 7.4%. The percentage of respondents planning to buy a major appliance fell to 46.3% after surging to 48.9% in May from 43.0% in April.

The Consumer Confidence data are available in Haver's CBDB database. The total indexes, which are indexed to 1985=100, appear in USECON, and market expectations are in AS1REPNA.