Consumer Sentiment Tumbles on Fears of Slower Income Growth
The Thomson Reuters/University of Michigan's final May reading on the overall index on consumer sentiment came in at 81.9, down from 84.1 the month before.
It was also below the expectation of 82.5 among economists polled by Reuters. However it did show a slight increase from the preliminary reading issued on May 16.
"The slippage in consumer confidence came to a halt in late May," survey director Richard Curtin said in a statement.
Curtin said the level may have declined by 2.2 points since April, but when averaging in the first four months of the year, the May figure was slightly above the average of 81.7.
"At present, the economy was anticipated to be strong enough in the year ahead to produce the best change in job prospects since 2004," Curtin said.
"The main concern expressed by consumers involved dismal prospects for wage growth, which for nearly half of all households meant anticipated declines in inflation-adjusted incomes and living standards during the year ahead," he added.
Some 56 percent of consumers reported that the economy had improved, up from 49 percent in April.
The survey's barometer of current economic conditions fell to 94.5 from 98.7 in April and below a forecast of 95.8.
The gauge of consumer expectations slipped to 73.7 from 74.7 and fell short of an expected 74.0.
The survey's one-year inflation expectation rose to 3.3 percent from last month at 3.2 percent, while the survey's five-to-10-year inflation outlook fell to 2.8 percent from 2.9 percent in April.
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