US consumer confidence recovers level from before start of Covid-19 pandemic
Americans' confidence in the economy - both present and future - snapped back to its levels from before the start of the Covid-19 pandemic last month, despite the tremendous scars that it had left on the jobs market.
The Conference Board's consumer confidence index improved from a reading of 120 points for May to 127.3 in June (consensus: 119.0).
Sub-indices linked to their assessment of the current situation as well as their expectations both improved significantly.
Boosting the former, according to Ian Shepherdson at Pantheon Macroeconomics, was the state of the labour market, where demand now seemed to be running ahead of supply "to an unprecedented extent".
Yet US non-farm payrolls remained about 10.0m below the level that might be expected where it not for the pandemic.
Expectations on the other hand were being lifted by the buoyant stock market and declining numbers of Covid-19 infections.
The only snag was inflation expectations, which rose by two tenths of a percentage point to 6.7% on a 12-month basis.
Nevertheless, as Shepherdson pointed out: "Right now, expectations are no higher than we’d expect, given the pace of food and energy inflation."
For her part, Conference Board director, Lynn Franco, noted that consumers' purchasing intentions for homes, automobiles, and major appliances all rose in June, despite expectations for quicker price gains.
Vacation intentions also rose, she said.