U.S. consumer sentiment dipped in early July while an index of consumer expectations weakened for a third straight month, a survey released on Friday showed.
The Thomson Reuters/University of Michigan's preliminary July reading on the overall index on consumer sentiment came in at 81.3, below both the consensus analyst expectation of 83 and the final June read of 82.5.
"The most remarkable aspect of recent trends in consumer confidence has been its resistance to change in either direction due to very negative GDP nor very positive employment gains,'' survey director Richard Curtin said in a statement.
"This stability will provide the necessary strength for consumer spending to continue to expand, but does not support an acceleration in spending above 2.5 percent.''
The survey's barometer of current economic conditions rose to 97.1 from 96.6, compared with a forecast of 97.0. The survey's gauge of consumer expectations slipped for a third straight month, to 71.1 from 73.5. The subindex was below an expected 74.0.
The survey's one-year inflation expectation rose to 3.3 percent from 3.1 percent in June, while the survey's five-to-10-year inflation outlook fell to 2.6 percent from 2.9 percent. Curtin said long-term inflation expectations had only been lower once in the past 25 years, in 2009, when expectations were for 2.5 percent.
"Indeed, 2.6 percent was only recorded twice before at the depth of the Great Recession,'' he said. ``While at the bottom of the range it has traveled in the past decade, it gave no indication of a trend toward deflation.''