Consumer Confidence Jumps This Month
How’s this for a ray of sunshine amid the clouds of economic uncertainty: The Conference Board reported that its Consumer Confidence Index rose more than 7 points in June, the highest reading since January 2022. In addition, consumers’ view of current business and labor conditions jumped from May to June, while their short-term outlook for income, business and labor market conditions, known as the Expectations Index, also went up.
Dana Peterson, chief economist at The Conference Board, said that the burst of confidence can be linked to a still-strong labor market and other macro factors taken into consideration among consumers of all demographics. “Assessments of the present situation rose in June on sunnier views of both business and employment conditions. Indeed, the spread between consumers saying jobs are ‘plentiful’ versus ‘not so plentiful’ widened, indicating upbeat feelings about a labor market that continues to outperform,” Peterson reported. “Likewise, expectations for the next six months improved materially, reflecting greater confidence about future business conditions and job availability.”
[Read more: “Grocery Inflation Steady in May"]
According to the think tank’s latest data, confidence was most evident among people under age 35, and those earning more than $35,000. Mirroring growing confidence, consumers overall are dialing back some of their worst economic fears, as 69.3% of consumers said this month that a recession is “somewhat” or “very likely,” compared to 73.2% in May. Looking ahead, 30.3% of respondents said that they expect their family finances to improve over the next six month, up from 28.9% last month.
Although the outlook is slightly sunnier, consumers who have gone through the tumultuous last few years are also realists. The Expectations Index is only a bit below the threshold indicating a potential recession and, while consumers are more optimistic, they are still taking a wait-and-see approach to big purchases like cars, homes and vacations, The Conference Board found.
The monthly Consumer Confidence survey is conducted for The Conference Board by tech company Toluna, which uses technology and a panel of over 36 million consumers. Established in 1916, The Conference Board is a nonprofit, nonpartisan organization based in New York.
