Consumer confidence slipped in July after a big gain in the previous month as petrol pump prices reached new highs, according to a July 26 survey by the Conference Board.
Its consumer confidence index for July fell to 103.2 in July from a revised 106.2 in June, which was the highest level in three years. Economists had been expecting the index to rise to 106.2 in July.
Haseeb Ahmed, economist at JP Morgan/Chase, noted that swings in consumer confidence over the past year have tracked sharp movements in gasoline prices, which set another record high in July.
But Lynn Franco, director of the Conference Board's consumer research center, played down the decline in the index as "not cause for concern". "The overall state of the economy remains healthy and consumers' outlook suggests no storm clouds on the short-term horizon," she said in a statement.
The percentage of consumers who believe the economy is "good" improved in the survey to 28.7% from 26.7%. However, those believing conditions are "bad" also increased, to 16.9 % from 15.3%.
The proportion of consumers anticipating their incomes to improve in the six months ahead fell to 18.6% from 19.9%.
Copyright Agence France-Presse, 2005