Confidence in future economic prospects continued slipping into early July, the University of Michigan reported Friday.
U.S. consumer sentiment fell to 93.1 in a preliminary survey. Economists expected consumer sentiment to hit 95 in July, according to Thomson Reuters consensus estimates.
“Overall, the recent data follow the same pattern repeatedly recorded around past cyclical peaks: expectations start to post significant declines while assessments of current economic conditions continue to reach new peaks,” Richard Curtin, a chief economist for the University of Michigan’s survey of consumers, said in a statement.
“To be sure, the data do not suggest an impending recession. … Much steeper declines in expectations typically precede recessions.”
U.S. consumer sentiment last fell to 95.1 in June, sinking 2.1 percent from May.
The declines being recorded by the group are “now consistent with just above 2% GDP growth in 2017,” Curtin said. “[T]he data indicate that hopes for a prolonged period of 3% GDP growth sparked by Trump’s victory have largely vanished…”
In a preliminary July survey, a reading of current U.S. economic conditions is at 113.2, and an index of consumer expectations sits at 80.2, the University of Michigan said.
Notably, consumers’ assessments of current economic conditions hit the highest level since a July 2005 survey.
The monthly survey by the University of Michigan measures 500 consumers’ attitudes toward topics such as personal finances, inflation, unemployment, government policies and interest rates.
The University of Michigan’s next data release is scheduled for July 28 at 10 am ET.