Consumer confidence rose for the third straight month in June, setting a new five-year high for the second straight month, the Conference Board reported June 25.
Boosted by increased labor market optimism, the confidence index was up 7.1 points to 81.4 seasonally adjusted (1985 = 100) from 74.3 in May, and has risen 19.5 points over the past three months combined, the New York-based nonprofit organization said.
The sustained improvement in consumers' outlooks on business and labor market conditions may signal a pickup in economic growth, according to Lynn Franco, director of the board's Consumer Research Center.
“Expectations have … improved considerably over the past several months, suggesting that the pace of growth is unlikely to slow in the short-term, and may even moderately pick up,” Franco said.
Contributing to June's increase in the consumer confidence index were gains in assessments of both current conditions (by 4.4 points to 69.2) and future expectations (by 8.9 points to 89.5).
The share of consumers who believed jobs currently are plentiful rose 1.8 percentage points to 11.7 percent, while those who said jobs are “not so plentiful” dropped 2.3 percentage points to 51.4 percent. Those who found jobs “hard to get” inched up 0.5 percentage point to 36.9 percent.
Although the share of Americans who felt current business conditions were “good” held steady at 19.1 percent in June, those who saw conditions as “bad” declined 1.1 percentage point to 24.9 percent. The remaining 56.0 percent said conditions were “normal,” up from 54.9 percent the prior month.
Looking ahead six months, consumers felt more optimistic about business conditions and employment than they did one month earlier, while those with negative outlooks moved in the opposite direction.
Although still in the minority, 20.3 percent of Americans anticipated improved business conditions in six months, up from 18.7 percent in May, and 19.6 percent expected “more jobs,” up from 16.3 percent. By contrast, 11.4 percent of consumers anticipated worse conditions, down from 12.2 percent, and 16.1 percent foresaw “fewer jobs,” down from 20.0 percent. Roughly two-thirds of Americans in both categories anticipated no change.
The confidence boost was not reflected in future income expectations, as 15.2 percent of Americans in June anticipated an increase in their household income in six months, down from 15.6 percent the prior month, while 14.4 percent anticipated decreased income, down from 15.3 percent. The remaining seven in 10 Americans foresaw no income change.
The figures were derived from a survey of 5,000 households conducted through June 13.
Information about the consumer confidence report is available at http://www.conference-board.org/data/consumerconfidence.cfm.
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