KNOWLEDGE is POWER / REAL NEWS is KEY
New York: Thursday, July 18, 2024
© 2024 U-S-NEWS.COM
Online Readers: 325 (random number)
New York: Thursday, July 18, 2024
Online: 321 (random number)
Join our "Free Speech Social Platform ONGO247.COM" Click Here
Money & Business: Us Consumer Confidence Retreats Slightly; House Prices

MONEY & BUSINESS: US consumer confidence retreats slightly; house prices remain elevated – One America News Network

🔴 Website 👉 https://u-s-news.com/
Telegram 👉 https://t.me/usnewscom_channel

June 25, 2024 – 9:34 AM PDT

WASHINGTON (Reuters) – U.S. consumer confidence eased in June amid worries about the economic outlook, but households remained upbeat about the labor market and expected inflation to moderate over the next year.

Advertisement

The mixed survey from the Conference Board on Tuesday also showed consumers’ perceived likelihood of a recession over the next 12 months retreated this month after rising in April and May.

Though fewer consumers planned to buy vehicles and household appliances over the next six months, more planned to go on vacation. Labor-market resilience is driving consumer spending, underpinning the economy despite the Federal Reserve’s hefty interest-rate hikes in 2022 and 2023 to quell inflation.

“The mild decrease in confidence isn’t consequential and we think there are sufficient tailwinds to keep consumers spending,” said Oren Klachkin, financial market economist at Nationwide. “The economy is on a glide path to normalized conditions.”

The Conference Board’s consumer confidence index dipped to 100.4 this month from a downwardly revised 101.3 in May. Economists polled by Reuters had forecast the index slipping to 100.0 from the previously reported 102.0.

The drop in confidence was concentrated in the 35-54 age group. Confidence improved among consumers under 35 and those 55 years and older.

Politics stayed on the radar of consumers, though the share believing the November presidential election would have an impact on the economy was low in comparison to the same period in 2016. It was slightly higher than in June 2020, before the last presidential election.

The Conference Board said there was no clear pattern in terms of income groups, but noted that on a six-month moving average basis, confidence remained the highest among the under-35 age cohort and those with annual incomes of more than $100,000.

“Confidence remained within the same narrow range that’s held throughout the past two years, as strength in current labor market views continued to outweigh concerns about the future,” said Dana Peterson, chief economist at the Conference Board. “However, if material weaknesses in the labor market appear, confidence could weaken as the year progresses.”

LABOR MARKET RESILIENT

The survey’s so-called labor-market differential, derived from data on respondents’ views on whether jobs are plentiful or hard to get, widened to 24 from 22.7 in May.

The measure closely correlates to the unemployment rate in the Labor Department’s employment report. Labor-market conditions are gradually easing, with the unemployment rate rising to a still relatively low 4% in May for the first time since January 2022.

Consumers’ 12-month inflation expectations fell to 5.3% from 5.4% in May. Write-in responses to the survey showed elevated prices, especially for food and groceries, continued to affect consumers’ views of the economy, the Conference Board said.

The share of consumers planning to buy vehicles over the next six months fell as did that of those intending to purchase big-ticket items, mostly clothes dryers and TVs. Purchasing plans for washing machines rose and were unchanged for refrigerators.

More consumers planned to go on vacation compared to April, with most eying domestic destinations and intending to fly rather than drive. There is no strong correlation between consumer confidence and spending.

“While a weakening in confidence does not bode well for consumption going forward, sentiment has been depressed for some time even as households have continued to spend,” said Rubeela Farooqi, chief U.S. economist at High Frequency Economics.

The share of consumers planning to buy a home was unchanged at a relatively low level for a fourth straight month. That is consistent with so-called hard data on home building and sales, that have shown the housing market regressing since residential investment notched double-digit growth in the first quarter.

Higher mortgage rates and house prices are stifling demand. A report from the Federal Housing Finance Agency on Tuesday showed single-family house prices rose 0.2% month-on-month in April after being unchanged in March. In the 12 months through April, house prices increased 6.3% after advancing 6.7% in March.

House-price appreciation could, however, slow as reduced affordability weighs on demand for housing, contributing to a rise in supply. The National Association of Realtors reported last week that home inventory jumped in May to the highest level in nearly two years.

The average rate on the popular 30-year fixed mortgage hit a six-month high of 7.22% in early May, data from mortgage finance agency Freddie Mac showed. Though it has since retreated to 6.87% last week, the rate remains above the 6.67% average during the same period last year.

All nine census regions recorded annual house-price gains in April, with hefty increases in New England and Middle Atlantic.

Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Rod Nickel

Share this post!





Source link

OnGo247
New 100% Free
Social Platform
ONGO247.COM
Give it a spin!
Sign Up Today
OnGo247
New 100% Free
Social Platform
ONGO247.COM
Give it a spin!
Sign Up Today