Consumer confidence rises again despite record income uncertainty, University of Michigan says

Consumer confidence in the States improved for a second consecutive month but almost half of Americans were already expecting a renewed downturn over the longer-term due to a resurgence in the Covid-19 pandemic.

The University of Michigan's consumer confidence index hit a preliminary reading of 78.9 for June, up from 72.3 in May (consensus: 76.0).

According to the survey's director, Richard Curtin, renewed gains in employment were the chief factor behind the turnaround, feeding gains in the outlook for personal finances and the national economy.

With the lockdown, more Americans than ever before were expecting unemployment to fall, but "few consumers anticipate the reestablishment of favorable economic conditions anytime soon."

"The most often cited cause of a renewed downturn is a resurgence in the spread of the coronavirus, and the most often cited cause of a slow economic recovery is the financial damage from persistently high unemployment," he added.

The result was a record level of uncertainty over income prospects, which in turn had a "significant" impact on consumers' willingness to make discretionary purchases.

"Importantly, these concerns have also been mitigated by deep discounts on prices and interest rates."