U.S. consumption growth should remain solid in H2 15

The University of Michigan consumer sentiment index was revised up more than expected in the final June print, to 96.1 from the preliminary mid-month estimate of 94.6. The current conditions index rose to 108.9 (initial: 106.8) and consumer expectations advanced to 87.8 (initial: 86.8).  Long-term inflation expectations ticked down one-tenth from the initial estimate (2.6%, initial: 2.7%) though year-ahead expectations were unchanged at 2.7%. 

The details of the final June survey show modest improvements across several forward-looking survey components. The index that measures unemployment expectations improved modestly to 105 (initial: 102). Buying conditions for household durables surged. The index rose to 163 from the initial estimate of 156 and now sits at the highest level since January 2007. Vehicle buying sentiment rose to 145 (previous: 140) and home selling sentiment climbed to 121 (previous: 115). 

"Following this week's better-than-expected data on durables consumption and home sales for May, we view these June sentiment results as indicating likely follow-through through the end of Q2. Furthermore, the strongest print for consumer sentiment since January suggests consumption growth should remain solid in H2 15." notes Barclays