Economy Experiencing ‘More of the Same’ [AUDIO]
Home prices are heading upward, gas prices are moving lower which is good news.
But, several months of lackluster jobs reports sent consumer confidence down for the fourth straight month.
“Basically, we’re just seeing more of the same. We’re in a slow-growth environment which is going to continue for the short term,” said Lynn Franco, Director of Economic Indicators at the Conference Board. “As long as we continue to see these improvements, it should be enough to sustain spending in the longer term.”
“Obviously, there is still a great deal of uncertainty out there. People are worried about jobs and hiring, they have their eyes on the situation in Europe. We don’t expect that to dissipate overnight,” said Franco. “The silver lining here is that when it comes to consumers assessment of current conditions, we have seen moderate improvement so we know the economy is not hitting the skids. It’s just going to take some time.”
Despite the positive signs, Americans appear to be holding onto their cash. “We don’t really expect a dramatic decline in consumer spending, nor do we expect a dramatic pick up,” said Franco.
The Consumer Confidence Index is now at 62, down from 64.4 in May and below the 63.2 analysts were expecting. The index remains below the 90 reading that indicates a healthy economy, but it hasn’t been at that level since the recession began in December 2007. It’s no where near the all-time low of 25.3 which was reached in February 2009.
After solid job gains during the first three months of the year, there’s been a sharp slowdown in hiring in April and May. Meanwhile, the measure of the number of people applying for unemployment benefits over the past month has reached a six month high. That increase suggests that layoffs are rising and June could be another lackluster month for hiring.