Consumer confidence drops more than expected, reaching its lowest point in nearly two years
- The Conference Board's consumer confidence index declined to 121.5 in June.
- "The escalation in trade and tariff tensions earlier this month appears to have shaken consumers' confidence," Conference Board senior director Lynn Franco said.
- The drop brought the index to its lowest level since September 2017.
A key measure of the American economy slipped this month after three consecutive months of increases as consumers saw the trade war with China as an increased risk.
The Conference Board's consumer confidence index declined to 121.5 in June, the business research group said on Tuesday. The drop was more than the decline to 131.1 that economists surveyed by Reuters expected.
In May, the Conference Board reported a preliminary reading of 134.1 for the index, but revised last month's number to 131.3 in the latest report.
The drop brought the index to its lowest level since September 2017.
"The escalation in trade and tariff tensions earlier this month appears to have shaken consumers' confidence," Conference Board senior director Lynn Franco said in a statement. "Although the Index remains at a high level, continued uncertainty could result in further volatility in the Index and, at some point, could even begin to diminish consumers' confidence in the expansion."
The measurement of consumers gives an assessment of the current U.S. economic climate, as well as consumer expectations for the coming six months.
Overall, consumers were less optimistic about the near future. The Conference Board's survey found a decreasing number of Americans think business conditions will improve six months from now, dropping to 18.1% of those surveyed to 21.4%.
Expectations for the U.S. job market were also lower, as the report said the number of consumers expecting the economy to add jobs in the near-term decreased to 17.2% from 18.4%, while those expecting less jobs in the near-term increased to 13% from 14.8%.