U.S. consumer confidence unexpectedly improves in July

The Conference Board announced on Tuesday its U.S. consumer confidence edged up 0.2 points to 129.1 in July from 128.9 in June. This was the highest reading since February 2020.

Economists had expected consumer confidence to ease to 123.9.

June’s consumer confidence reading was revised up from the originally estimated 127.3.

The survey showed that the present situation index rose from 159.6 in June to 160.3 this month. Meanwhile, the expectations index edged down from 108.5 last month to 108.4 in July.

“Consumer confidence was flat in July but remains at its highest level since February 2020,” noted Lynn Franco, Senior Director of Economic Indicators at The Conference Board. “Consumers’ appraisal of present-day conditions held steady, suggesting economic growth in Q3 is off to a strong start. Consumers’ optimism about the short-term outlook didn’t waver, and they continued to expect that business conditions, jobs, and personal financial prospects will improve. Short-term inflation expectations eased slightly but remained elevated. Spending intentions picked up in July, with a larger percentage of consumers saying they planned to purchase homes, automobiles, and major appliances in the coming months. Thus, consumer spending should continue to support robust economic growth in the second half of 2021.”