U.S. consumer sentiment rises further in June, household sector likely to stay on solid footing

The U.S. Conference Board’s index of consumer sentiment rose in June. The index edged higher to 118.9 in June, while the data for May was downwardly revised a bit to 117.6 from 117.9. The June’s data came in opposite to market expectations. Consensus projections were for the sentiment index to drop to 116.

The present situation index rose solidly to 146.3 from 140.6; however, some of this rise was countered by a deterioration in the consumer expectations measure that dropped to 100.6 from 102.3. Meanwhile, the labor market differential, which gauges the net share of consumers that see employment as plentiful, rose to 14.8, its highest since 2001. This points to continued strength in labor markets.

Household confidence has rebounded at a solid rate since the elections and the consumer sentiment is viewed as remaining buoyant and close to post-recession highs, noted Barclays in a research report. The U.S. household sector is expected to remain on solid footing and the first quarter weakness is likely to be temporary, added Barclays.

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