With consumer expectations regarding the short-term outlook weakening in July, the Conference Board released a report on Tuesday showing that U.S. consumer confidence for the month fell by more than economists had anticipated.
The Conference Board said its consumer confidence index dropped to 80.3 in July from a revised 82.1 in June. Economists had been expecting the index to dip to 81.0 from the 81.4 originally reported for the previous month.
The bigger than expected decrease by the consumer confidence index came after it reached a more than five-year high in June.
"Consumer Confidence fell slightly in July, precipitated by a weakening in consumers' economic and job expectations," said Lynn Franco, Director of Economic Indicators at The Conference Board. "However, confidence remains well above the levels of a year ago."
Reflecting the weakening in consumer expectations, the expectations index fell to 84.7 in July from 91.1 in June.
The Conference Board said the percentage of consumers expecting business conditions to improve over the next six months fell to 19.1 in July from 21.4 in June, while consumers expecting conditions to worsen remained virtually unchanged at 11.2 percent.
Consumers' outlook for the labor market was also less upbeat, with those expecting more jobs in the months ahead falling to 16.5 percent from 19.7 percent, while those expecting fewer jobs rose to 18.1 percent from 16.1 percent.
Meanwhile, the report said the present situation index climbed to 73.6 in July from 68.7 in June, as consumers' appraisal of current conditions continued to improve.
Consumers saying business conditions are "good" rose to 20.9 percent from 19.4 percent, while those saying conditions are "bad" fell to 24.5 percent from 24.9 percent.
The Conference Board noted that the assessment of the job market was also more positive, as those saying jobs are "plentiful" climbed to 12.2 percent from 11.3 percent, while those saying jobs are "hard to get" dipped to 35.5 percent from 37.1 percent.
"Consumers' assessment of current conditions continues to gain ground and expectations remain in expansionary territory despite the July retreat," Franco said.
She added, "Overall, indications are that the economy is strengthening and may even gain some momentum in the months ahead."
Last Friday, Thomson Reuters and the University of Michigan released a separate report showing that consumer sentiment improved to its best level in six years in July
The report showed that the consumer sentiment index for July was upwardly revised to 85.1 from the preliminary reading of 83.9. Economists had expected the index to be upwardly revised to 84.0.
With the upward revision, the index was above the final June reading of 84.1 and at its highest level since July of 2007.
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