FILE PHOTO: A shopkeeper works inside his retail store as the phase one reopening of New York City continues during the outbreak of the coronavirus disease (COVID-19) in the Brooklyn borough of New York City, New York, U.S. June 9, 2020. REUTERS/Shannon Stapleton/File Photo
WASHINGTON (Reuters) – U.S. 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 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 labor 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% this month from 14.6% in May and the proportion anticipating a drop fell to 14.4% from 15.4%.
Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Bernadette Baum