Steady job growth boosts US consumer confidence

Published on NewsOK Modified: June 27, 2014 at 10:16 am •  Published: June 27, 2014
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WASHINGTON (AP) — Strong job growth lifted U.S. consumer confidence this month, as Americans looked past the economy's dismal first quarter performance.

The University of Michigan said Friday that its index of consumer sentiment rose slightly to 82.5 in June from 81.9 in May. That is still below April's reading of 84.1, which had been the highest in almost a year.

Confidence "has remained largely unchanged for the past six months," said Richard Curtin, an economist at the University of Michigan and director of the survey. "This was remarkable" given that the economy shrank in the first quarter.

Still, the survey was mostly conducted when the government had estimated that the economy contracted at a 1 percent annual rate in the first quarter. On Wednesday, that estimate was revised much lower, to show a contraction of 2.9 percent.

And so far, steady confidence hasn't yet translated into more spending. Consumer spending rose just 0.2 percent in May after a flat reading in April. Weaker spending suggests growth won't rebound as strongly as many economists had hoped. Some marked down their forecasts for growth in the second quarter, to roughly 2.5 percent from 3 percent.