New York Americans are increasingly optimistic that the economy may be ready to turn around in the second half of the year, according to the latest reading on consumer confidence.
The New York-based Conference Board said Tuesday that its Consumer Confidence Index held steady in June, edging back to 83.5 in June from a revised 83.6 in May following two consecutive months of increases. Still, the reading was better than analysts' projection of 82.
The report consists primarily of two readings: one that measures consumers' assessment of the current economy and a second that looks at their outlook during the next six months. The reading on current conditions was down, but consumers were upbeat about the rest of the year.
"It's obviously good news about consumer spending, not blockbuster numbers, but it does indicate firm underpinning for the economy. It is good for second-half consumer spending growth," said Sherry Cooper, chief economist for BMO Nesbitt Burns in Chicago.
The confidence index is watched closely by economists because consumer spending accounts for two-thirds of the domestic economy. Consumers' willingness to continue their purchases have powered the economy through the current downturn, even as businesses have sharply limited spending.
"The recent turnaround in the stock market and an easing in unemployment claims should keep consumer expectations at current levels and may signal more favorable economic times ahead," said Lynn Franco, director of the Conference Board's Consumer Research Center.
The Conference Board's indexes are derived from responses received through June 17 to a survey mailed to 5,000 households in a consumer research panel. The results are from a partial sample of at least 2,500 respondents.