US consumer confidence deteriorates more than expected in July

(RTTNews) – A report released Tuesday by the Conference Board showed that consumer confidence in the United States deteriorated more than expected in July.

The Conference Board said its consumer confidence index slipped to 95.7 in July from a downwardly revised 98.4 in June. Economists had expected the index to fall to 96.8 from the 98.7 originally reported for the previous month.

“Consumer confidence fell for a third straight month in July,” said Lynn Franco, senior director of economic indicators at The Conference Board. “Concerns about inflation – rising gasoline and food prices, in particular – continued to weigh on consumers.”

She added: “As the Fed raises interest rates to contain inflation, purchase intentions for cars, homes and major appliances all fell further in July.”

The bigger than expected drop in the consumer confidence index came as the current situation index fell to 141.3 in July from 147.2 in June.

The report showed a much more modest drop in the expectations index, which fell slightly to 65.3 in July from 65.8 in June.

“Looking ahead, inflation and additional rate hikes should continue to pose strong headwinds to consumer spending and economic growth over the next six months,” Franco said.

On Friday, the University of Michigan is expected to release its revised July consumer sentiment reading.

The consumer confidence index for July is not expected to be revised from the preliminary reading of 51.1, which was up from June’s record high of 50.0.

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