US consumer confidence declined this month due to a less optimistic outlook for business conditions, the job market, and incomes, according to data from The Conference Board. The index measuring sentiment dropped to 100.4 from a revised 101.3 reading in May. Economists had predicted a reading of 100. Expectations for the next six months fell by nearly 2 points to 73, while present conditions improved slightly from the previous month.
Over the past few years, consumer confidence has been modest as individuals grapple with a higher cost of living, rising borrowing costs, and a softening labor market. Only 12.5% of consumers anticipate improvement in business conditions over the next six months, marking the smallest share since 2011. Despite the slight dip in confidence in June, the Federal Reserve continues to be positive about the future.
Concerns about prices eased slightly this month, although consumers did note higher prices for groceries. Recent inflation data showed a decrease in price increases for US consumers in May. Consumers also scaled back plans to purchase motor vehicles and major appliances, but indicated an intent to travel domestically in the second half of the year.
Consumers’ perception of the current labor market improved marginally, with more individuals considering jobs to be “plentiful” compared to the previous month. Additionally, fewer respondents described jobs as “hard to get.” The survey also revealed that the portion of consumers who believe the upcoming election will impact the economy was low compared to previous years, indicating a level of optimism regarding the economic outlook.