NEW YORK (7/29/15)--Consumers’ confidence tumbled an unexpected 8.9 points in July, largely due to a sharp decline in the expectations index about the job market, according to The Conference Board’s Consumer Confidence Index, released Tuesday.
July’s index was 90.9, down from 99.8 in June and a 10-month low.
Economists had expected a slight increase in confidence, said Economy.com (July 28).
The present situation index decreased moderately to 107.4 in July, down from 110.3 in June, while the expectations index declined sharply, to 79.9 from June’s 92.8, said the board.
“Consumers continue to assess current conditions favorably, but their short-term expectations deteriorated this month,” said Lynn Franco, director of economic indicators at the Conference Board. “A less optimistic outlook for the labor market, and perhaps the uncertainty and volatility of financial markets prompted by the situation in Greece and China, appear to have shaken consumers’ confidence. Overall, the index remains at levels associated with an expanding economy and a relatively confident consumer.”
When asked about current conditions, respondents saying business conditions are “good” decreased to 24.2% from 26.1%, while those saying the same conditions are “bad” remained unchanged at 17.9%.
The job market drew less positive responses from consumers, the board said. Those stating jobs are “plentiful” dropped to 20.7% from 21.3%, while those saying jobs are “hard to get” increased to 26.7% from 26.1%.
Consumers were less optimistic about the short-term outlook. Those expecting business conditions to improve the next six months declined to 14.7% from 17.9%. Those expecting conditions to worsen rose to 10.7% from 10.2%.
Consumers were even less optimistic about the jobs market. Those expecting more jobs in the months ahead decreased to 13.1% from 17.1%, while those anticipating fewer jobs rose to 20% from 15.2%. Fewer respondents expected their incomes to grow: 17%, down from June’s 17.6%. Those expecting a decline in income increased--to 11.2% from 10.6%.
The monthly Consumer Confidence Survey is conducted for The Conference Board by Nielson, a global information and analytics provider.