U.S. Consumer Confidence Worsens In June To 56.7

Washington, D.C. (AHN) - A preliminary reading of consumer sentiment in June worsened from bad after a consumer index dropped, a report said.

Confidence among U.S. consumers declined to a 28-year low to 56.7 in June compared to 59.8 in the month of May, according to preliminary results from the University of Michigan and Reuters released on Friday.

The market analysts surveyed by the reports indicated that the reading was expected to be at 59.8 in June. The measure was around 85.6 in 2007.

The U.S. consumers expect the inflation rate to be at 3.4 percent over the next five years, which is the highest reading registered since 1995 and remained unchanged from May.

While, the one year inflation expectations by the consumers was 5.1 percent in June, compared to the 5.2 percent reported in the month of May.

Consumer sentiment further weakened as the economy slowed down led by higher gas and food prices.

In a seperated report, the Labor Department showed the U.S. consumer prices increased more than expected in the month of May led by the rising fuel prices.

The consumer price index gained at a seasonally adjusted rate of 0.6 percent, which is the highest since November 2007, after it was up by 0.2 percent in April, according to the report released on Friday.

The core consumer price index (CPI), excluding food and energy prices, climbed up by 0.2 percent as expected.

Meanwhile, the consumer sentiment report showed the measure of current conditions, reflecting the consumers' financial situation to buy large items like automibles, declined to 68.7 from 73.3 the prior month.

The preliminary survey was conducted among 300 households, compared to the finalconsumer confidence report that consists of responses from 500 housholds.