The University of Michigan preliminary consumer sentiment index for June came in at 94.5 from May’s reading of 97.1. This is the lowest level since November 2016. Analysts had expected a decline to 97.
Economists note that the drop reflects consumers’ concerns over US President Donald Trump being unable to fulfill his campaign promises to boost economic growth amid political scandals.
The current economic conditions index declined to 109.6 from 111.7 in the previous month. The measure of consumer expectations for the next six months fell to 87.7 from 84.7.
Median one-year ahead inflation expectations were unchanged at 2.6%, while long-term inflation expectations (5–10 years ahead) increased to 2.6% from 2.4%.
The survey’s baseline of 100 was set in 1966. The average reading during the recent recession that started in December 2007 and lasted 18 months was 64.2, while 5 years before it stood at the level of 89.
