The U.S. consumer confidence decreased in June because Americans became more doubtful about business conditions and job market prospects for upcoming months according to data released on Tuesday.
The Conference Board’s index decreased to 93.0 during June after reaching 98.4 in May thus eliminating most of the previous month’s increase. Economists had expected an increase to 100.
The decline affected both present economic conditions and projected future developments. According to Stephanie Guichard senior economist at the Conference Board consumers have shown declining job availability perceptions for six consecutive months but still maintain a positive outlook.
The report indicates that economic uncertainty is increasing despite lower inflation rates and low unemployment levels.
Consumer sentiment functions as a vital economic indicator because it determines future spending behaviors which generate more than two-thirds of U.S. GDP. The decline in consumer confidence may negatively affect spending patterns during the second half of the year.
Household sentiment receives close attention from investors and policymakers because they need to understand how tariffs and Fed decisions and geopolitical events affect the overall economy.
