A widely watched index of consumer confidence dipped sharply in June, weighed down by concerns about jobs.
The Conference Board, a private research group, said its Consumer Confidence Index plunged to 52.9 from the revised 62.7 in May. The consensus forecast of economists surveyed by Thompson Reuters had been for a slight drop to 62.8.
Both components of the index fell. The Present Situation Index, which measures how consumers feel now about the economy, dropped to 25.5 in June from 29.8 in May. The Expectations Index, which assesses their outlook over the next six months, fell from 84.6 to 71.2.
The index is based on a random survey of consumers sent to 5,000 households from June 1 to June 22. The index is closely watched by economists because consumer spending accounts for 70 percent of economic output. Consumer-related shipments also are the main driver of U.S. containerized imports, especially from Asia.
“Increasing uncertainty and apprehension about the future state of the economy and labor market, no doubt a result of the recent slowdown in job growth, are the primary reasons for the sharp reversal in confidence,” said Lynn Franco, director of the Conference Board’s Consumer Research Center. “Until the pace of job growth picks up, the consumer confidence is not likely to pick up.”
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