US consumer confidence rebounds in June amid rising COVID-19 cases

US consumer confidence rebounds in June amid rising COVID-19 cases

US consumers
FILE PHOTO: A shopper passes near a self-distancing queue outside Trader Joe's, as they limited the amount of shoppers allowed in the store to help prevent the spread of the coronavirus, in Bailey's Crossroads, Virginia. REUTERS/Kevin Lamarque

WASHINGTON, DC: US consumer confidence grew more than expected in June, strengthening views that the economic downturn was likely over, though rising COVID-19 infections threatened to derail the budding recovery.

The Conference Board said on Tuesday (Jun 30) its consumer confidence index rose to a reading of 98.1 this month from a downwardly revised 85.9 in May. Still, confidence remains 34.5 points below its pre-pandemic level. Economists polled by Reuters had forecast the index would rise to 91.8 in June.

"Consumers are less pessimistic about the short-term outlook, but do not foresee a significant pickup in economic activity," said Lynn Franco, senior director of economic indicators at The Conference Board.

"Faced with an uncertain and uneven path to recovery, and a potential COVID-19 resurgence, it’s too soon to say that consumers have turned the corner and are ready to begin spending at pre-pandemic levels.”

The survey's present situation measure, based on consumers' assessment of current business and labor market conditions, jumped to a reading of 86.2 this month from 68.4 in May.

The expectations index based on consumers' short-term outlook for income, business and labour market conditions jumped to 106.0 from a reading of 97.6 in May.

The percentage of consumers expecting an increase in income climbed to 15.1 per cent this month from 14.6 per cent in May and the proportion anticipating a drop fell to 14.4 per cent from 15.4 per cent.

Source: Reuters