U.S. consumer confidence declines

NEW YORK – July 28, 2015 – The Conference Board Consumer Confidence Index improved in June to 99.8 turned the other direction in July, bumping down to 90.9.

The Present Situation Index decreased moderately from 110.3 last month to 107.4 in July, while the Expectations Index – consumer's outlook about the economy six months in the future – declined sharply to 79.9 from 92.8 in June.

"Consumer confidence declined sharply in July, following a gain in June," says Lynn Franco, director of economic indicators at The Conference Board. "Consumers continue to assess current conditions favorably, but their short-term expectations deteriorated this month."

Franco suggests the July decline may be due to a "less optimistic outlook for the labor market, and perhaps the uncertainty and volatility in financial markets prompted by the situation in Greece and China."

Overall, however, Franco says the numbers remain in positive territory and the "Index remains at levels associated with an expanding economy and a relatively confident consumer."

Consumers' assessment of current conditions

Those saying business conditions are "good" decreased from 26.1 percent to 24.2 percent. However, those claiming business conditions are "bad" was virtually unchanged at 17.9 percent.

Consumers were slightly less positive about the job market. Those stating jobs are "plentiful" decreased from 21.3 percent to 20.7 percent, while those claiming jobs are "hard to get" increased marginally from 26.1 percent to 26.7 percent.

Consumers' optimism about the short-term outlook

The percentage of consumers expecting business conditions to improve over the next six months declined from 17.9 percent to 14.7 percent, while those expecting business conditions to worsen rose slightly from 10.2 percent to 10.7 percent.

Consumers' outlook for the labor market was less optimistic. Those anticipating more jobs in the months ahead decreased from 17.1 percent to 13.1 percent, while those anticipating fewer jobs increased from 15.2 percent to 20.0 percent.

The proportion of consumers expecting growth in their incomes edged down from 17.6 percent to 17.0 percent, while the proportion expecting a decline increased slightly from 10.6 percent to 11.2 percent.

Nielsen conducts the monthly Consumer Confidence Survey for The Conference Board. The cutoff date for the preliminary results was July 16.

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