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The
Conference Board said Tuesday that its consumer confidence index
rose 0.6 point to 91.2 in June, a figure that is still below its
year-ago reading of 95.2. Consumer attitudes worsened after the
Iran war caused oil and gas prices to spike, accelerating
inflation and causing Americans' inflation-adjusted incomes to
decline. Before the pandemic, the index regularly topped 120.
The report suggests that consumer confidence is recovering only
slowly from the hit caused by the Iran war. Even so, Americans
have continued to spend despite their dour outlook, which has
kept the economy growing even as inflation accelerated. Measures
of consumer sentiment have been less predictive of how Americans
actually shop since the pandemic.
“Consumer confidence inched up in June as falling oil prices in
recent weeks provided some relief to consumer inflation fears,”
Dana Peterson, the Conference Board's chief economists said in a
statement. “Consumer appraisals of current business conditions
were slightly more positive compared to last month. However,
perceptions of the current labor market softened measurably."
Earlier this month, a government report showed that consumers
stepped up their spending in May despite higher gas prices.
Analysts expect the steady consumer outlays kept the economy
growing at about a 2.5% annual rate in the April-June quarter.
Falling gas prices may also help boost Americans' outlook in the
coming months. On average nationwide, gas prices spiked above
$4.50 after the U.S.-Iran conflict began Feb. 28. They have
since fallen back to $3.85 a gallon, according to AAA.
The survey also found that consumers had a dimmer view of hiring
and the job market this month. The proportion of Americans who
said jobs are “hard to get” rose to 22.5% from 19.8% the
previous month, a noticeable increase.
But on Wednesday the government released a report showing that
the number of open jobs remained at a solid 7.6 million in May,
indicating that companies are showing more interest in
recruiting workers.
The Labor Department will release its monthly jobs report for
June on Thursday, and economists forecast it will show that
employers added 100,000 jobs, a solid gain. The unemployment
rate is expected to stay at a low 4.3%, according to data
provider FactSet.
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