With high income households expressing concerns about the prospects for the economy, the University of Michigan released a report on Friday showing a notable deterioration in U.S. consumer sentiment in the month of July.
The University of Michigan said the preliminary reading on the consumer sentiment index for July fell to 89.5 compared to the final June reading of 93.5. Economists had expected the index to come in unchanged.
Richard Curtin, the survey's chief economist, suggested the deterioration reflected concerns about the impact of Britain's vote to leave the European Union.
"Prior to the Brexit vote, virtually no consumer thought the issue would have the slightest impact on the U.S. economy," Curtin said. "Following the Brexit vote, it was mentioned by record numbers of consumers, especially high income consumers."
The report showed a notable decrease by the index of consumer expectations, which tumbled to 77.1 in July from 82.4 in June. The index fell to its lowest level in over a year.
The current economic conditions index showed a more modest decrease, edging down to 108.7 in July from 110.8 in June.
On the inflation front, the one-year inflation outlook rose to 2.8 in July from 2.6 in June, while five-year inflation expectations held at 2.6 percent.
by RTT Staff Writer
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