Consumer Confidence Tops Expectations
Rising household wealth helped consumer confidence in the United States exceed expectations for June, although slightly below May’s confidence reading by Thomson Reuters and the University of Michigan.
The reading of 84.1 was down slightly from 84.5 in May, but up nearly 15 percent from the June 2012 reading of 73.2. Analysts polled by Yahoo were expecting a reading of 81; market expectations were slightly higher, at 82.7.
The report said the June strength in consumer confidence was concentrated among upper-income households with annual income above $75,000, with their confidence rising to their highest level since mid-2007, due somewhat to healthy gains in stocks and home values.
In contrast, lower-income households were more likely to report income declines and no increases in their household wealth, the report said. Still, all income groups anticipated continued modest gains in the overall economy as well as continued slow declines in the national unemployment rate.
The report also cited increased confidence in the housing market as plans for home purchases continued to improve in June. The percentage of consumers who thought it was a bad time to buy a house dropped to its lowest level in 10 years, while the most consumers since 2006 thought home-selling conditions were favorable.
Also, rising home values were reported by the highest proportion of consumers since 2007, and the highest proportion of homeowners expected additional increases in their homes’ values in the year ahead. And, less than 10 percent of homeowners said they would lose money if they sold their homes today, half the level recorded a year ago, the report said.
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