The University of Michigan’s preliminary June Index of Consumer Sentiment came in at 48.9, up 9.2% from May’s final reading of 44.8, which marked the lowest level in recent years. This is materially higher than the forecast of 44.3, but well below last year’s June index of 60.7, with a year over year decrease of 19.4%. This month’s uptick in sentiment is broadly driven by easing gas prices in early June.
The ABA Office of the Chief Economist notes that the historically low consumer sentiment has not resulted in a decline in consumer spending. For banks, sustained weakness could mean softening demand for consumer credit heading into the second half of the year.
