"Consumer confidence declined slightly in May, primarily due to consumers rating current conditions less favorably than in April. Thus, they continue to expect little change in economic activity in the months ahead ".
- Lynn Franco, The Conference Board Consumer Research Center
In line with a drop noted in the preceding month, a report on consumer confidence released on Tuesday showed that the negative tendency is developing. According to the Conference Board, the confidence unexpectedly diminished further in May, slipping to its lowest level in six months, reaching 92.6 mark from a revised 94.7 in April. Such a release is well below the postrecession high of 103.8 set in the beginning of the pervious year. Meanwhile, majority of economists had expected the index to advance. Following data signalise that Americans continue to be cautious about the economy despite the seven years' recovery phase. However, their spending habits show that they are more upbeat than the confidence report suggests. In April, for example, consumer spending rose at the fastest rate since 2009. Also, consumers were relatively less optimistic about the short-term outlook, with the expectations index dipping to 79.0 in May from 79.7 in April. The proportion of consumers expecting business conditions to improve over the next six months increased from 13.8% to 15.1%.
Overall a strong dollar and poor global demand has hurt exports while upcoming Novembers' presidential election also is contributing to domestic economic uncertainty. Therefore, consumers remain cautious about the outlook for business and labor market conditions.
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