US Consumer Confidence Falls to 90.8 in July, Expectations Remain Below Recession Threshold - Forex | PriceONN
US consumer confidence weakened further in July as households grew less upbeat about current business conditions and the labor market, although easing inflation expectations offered a modest offset. The Conference Board’s Consumer Confidence Index slipped -1.4 points to 90.8 from an upwardly revised 92.2 in June. The Present Situation Index fell -3.6 points to 114.9, […] The post US Consumer Confidence Falls to 90.8 in July, Expectations Remain Below Recession Threshold appeared first on...

US consumer confidence weakened further in July as households grew less upbeat about current business conditions and the labor market, although easing inflation expectations offered a modest offset. The Conference Board’s Consumer Confidence Index slipped -1.4 points to 90.8 from an upwardly revised 92.2 in June. The Present Situation Index fell -3.6 points to 114.9, marking its third consecutive monthly decline, while the Expectations Index held steady at 74.7-well below the 80 level that has historically been associated with recession risks.

The latest survey suggests consumers remain unconvinced that economic conditions will improve meaningfully in the months ahead. According to Dana M. Peterson, Chief Economist at The Conference Board, confidence has continued its gradual downtrend since late 2021 as assessments of current business conditions and, to a lesser extent, the labor market deteriorated further. While expectations for future employment became slightly less pessimistic, consumers continued to anticipate little improvement in overall business conditions over the next six months. Household income expectations also moderated, although they remained positive overall.

There were, however, some encouraging signs beneath the headline figures. Both average and median 12-month inflation expectations eased in July, suggesting consumers are becoming somewhat less concerned about future price pressures. Even after recent market volatility, households continued to expect stock prices to rise over the coming year. Meanwhile, 61.3% of respondents still anticipated higher interest rates over the next 12 months, unchanged from June, indicating consumers remain prepared for monetary policy to stay restrictive even as confidence gradually softens.

Economic Data

Key Takeaways

  • Consumer confidence fell for a second straight month, extending the gradual downtrend that has been in place since late 2021.
  • The decline was driven by weaker assessments of current business conditions and the labor market, with the Present Situation Index falling for a third consecutive month.
  • The Expectations Index remained at 74.7, below the 80 threshold that has historically been associated with recession risks, suggesting consumers remain cautious about the economic outlook.
  • Consumers expect little improvement in business conditions over the next six months, although labor market expectations became slightly less pessimistic.
  • Inflation expectations eased further, indicating households are becoming less concerned about future price pressures.
  • Despite recent equity market volatility, consumers continued to expect stock prices to rise over the next year.
  • A majority (61.3%) still expect interest rates to move higher over the coming 12 months, highlighting expectations that monetary policy will remain restrictive.

    Full US Conference Board consumer confidence release here.

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