Consumer sentiment in the U.S. deteriorated by much more than anticipated in the month of June, according to a report released by Thomson Reuters and the University of Michigan on Friday, with the drop likely reflecting the disappointing jobs data.
The report showed that the consumer sentiment index fell to 74.1 in June from the final May reading of 79.3. Economists had expected the index to show a more modest decrease to a reading of 77.5.
The bigger than expected pullback by the index came after it reached its highest level since October of 2007 in the previous month.
The drop also pulled the consumer sentiment index down to its lowest level since coming in at 69.9 in December of 2011.
"Income losses were reported by nearly one-third of all households in early June and the news reaching consumers about job prospects turned negative for the first time since late 2011," survey director Richard Curtin said, according to Reuters.
He added, "In addition, a small but rising number of consumers reported their concerns about the fallout from Europe, the most that mentioned the potential domestic impact from an international crisis since the Asian flu in 1998."
The notable decrease by the headline index reflected deteriorations in consumers' assessment of current conditions as well as the outlook going forward.
The current economic conditions index fell to 82.1 in June from 87.2 in May, while the consumer expectations index tumbled to 68.9 from 74.3.
On the inflation front, one-year inflation expectations were unchanged at 3.0 percent, while the five-to-ten-year inflation outlook rose to 2.9 percent in June from 2.7 percent in May.
by RTT Staff Writer
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