Shoppers at the Mall of America in Bloomington, Minnesota on June 10.
Photo credit: Emilie Richardson / Bloomberg
Photo credit: Emilie Richardson / Bloomberg
US consumer confidence rose more than expected in June as optimism rose amid the reopening of business, although sentiment remained well below pre-pandemic levels.
The Conference Board index jumped 12.2 points to 98.1, the biggest gain for a month since late 2011, according to a report Tuesday. The median estimate in a Bloomberg survey of economists had asked for a reading of 91.5.
The group expectations subindex, based on consumers’ earnings, business and workforce prospects market conditions, soared to a four-month high of 106. Attitudes about the current situation gained 17.8 points to 86.2, the largest one-month gain since 1974.
The surge in confidence shows that Americans are picking up optimism as more businesses open, especially in affected states like New York, although the improvement was concentrated among higher-income people. New outbreaks in the west and south coast states, which have already caused some bars and beaches to close, could reduce confidence in July.
The deadline for the Conference Board preliminary survey results was June 18, suggesting that some responses predated the surge in virus cases that began in the third week of the month. That means the results are likely to show sentiment in the most optimistic weeks of state reopens.
“Facing an uncertain and uneven path to recovery, and a possible Covid-19 revival, it is too early to say that consumers have turned the corner and are ready to start spending at pre-pandemic levels,” Lynn Franco, director of the Conference Board director of economic indicators, said in a statement.
What Bloomberg Economists Say
“In the weeks since mid-June, several states have paused or reversed plans to restart activity in response to the increase in the number of Covid-19 cases. We hope this will decrease perceptions of the speed at which the labor market can recover, impacting sentiment and spending patterns. ”
– Andrew Husby and Eliza Winger
Read more for the full reaction note.
Data from last week showed that the University of Michigan Consumer Sentiment Index also It rose in June, but was still well below pre-pandemic levels.
The proportion of Conference Board respondents expecting better business conditions in six months was a record 42.6%, although little changed from the previous month, while the proportion expecting more jobs fell slightly to 38.4%.
At the same time, 15.1% of respondents said they expected their income to increase in the next six months, compared to 14.6% in May.
The group’s purchase plan measure was also reaffirmed mainly in June, with a higher proportion of consumers indicating they expected to buy homes and vehicles.
– With assistance from Chris Middleton
(Add graphics, purchase plans in the last paragraph)
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