US consumer confidence jumps to highest level since February 2022

Data shows 'notably brighter outlook for family finances', Conference Board says

US consumer confidence has increased, although plans to purchase vehicles have slowed. AP

Consumer confidence in the US soared this month due to optimistic views on labour market and business conditions, as well as a more positive outlook on family finances.

The Consumer Confidence Index increased to 109.7 this month, up from 102.5 in May, the Conference Board reported on Tuesday.

Consumers' assessment of current business and labour market conditions also rose to 155.3.

“Consumer confidence improved in June to its highest level since January 2022, reflecting improved current conditions and a pop in expectations,” said Dana Peterson, chief economist at the board.

The Expectations Index, which measures a six-month outlook, rose to 79.3.

Although it jumped from the month before, the sub-80 reading shows consumers continue to expect a recession in the next six to 12 months.

More consumers said jobs were “plentiful” in June. Meanwhile, the gap between “plentiful” and “hard to get” jobs measures widened to 34.4 per cent.

Plans to purchase cars and homes have slowed in June, however.

The board said there was a “notably brighter outlook for consumers' family finances”, with 30 per cent expecting their financial situation to improve in the next six months.

The improved disposition reflects a further decline in inflation. Data released on Tuesday showed the 12-month inflation expectations gauge fell to 6 per cent this month, its lowest since December 2020.

Tuesday's report comes before a closely monitored inflation metric cited by the Federal Reserve as part of its interest rate decisions.