U.S. Consumer Confidence Ticks Up, but Job Market Worries Keep Outlook Weak
U.S. consumer confidence improved slightly in June as falling gas prices eased some household inflation pressure, but the latest data also showed Americans remain cautious about jobs and the broader economy.
The Conference Board said its Consumer Confidence Index rose 0.6 points to 91.2, up from a downwardly revised 90.6 in May. The increase was modest, and the report showed a divided picture. Expectations for future income and business conditions improved, while views of current labor-market conditions weakened.
The labor-market signal may be the most important part of the report. The share of consumers saying jobs were “hard to get” rose to 22.5%, the highest level since January 2021, according to The Conference Board. The labor-market differential, which compares the share saying jobs are plentiful with the share saying jobs are hard to get, also declined.
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Reuters reported that economists had expected a stronger confidence reading, with forecasts calling for the index to rise to 94.7. Reuters also reported that gasoline prices dropped below $4 a gallon in mid-June for the first time since the U.S.-Israel war with Iran began at the end of February.
The practical consequence is that lower energy costs appear to have helped consumer mood, but not enough to erase anxiety about hiring, wages and prices. Consumer confidence matters because household spending is a major driver of the U.S. economy, and weaker views of the job market can affect big purchases, travel plans and discretionary spending.
The report also lands ahead of closely watched labor-market data. If hiring weakens further while inflation expectations remain elevated, the Federal Reserve will face a more complicated economic picture. Consumers may be getting some relief at the pump, but many still do not feel secure about the economy.
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