Confidence among U.S. consumers unexpectedly declined in July to the lowest level this year as Americans grew more pessimistic about their finances.
The Thomson Reuters/University of Michigan index of consumer sentiment dropped to 72 this month from June’s 73.2 reading. The gauge was projected to rise to 73.5, according to a median forecast of 69 economists surveyed by Bloomberg News.
The weakest quarter of hiring by companies in two years along with stock market volatility tied to Europe’s debt crisis threaten to hold back the household spending that accounts for about 70 percent of the economy. Sales at retailers such as Hhgregg Inc. (HGG) may struggle as fewer consumers expect their incomes to increase.
“The labor market has been pretty slow to recover, house prices are still low and there’s a lot of nervousness about what’s going on in Europe” and Washington, said Michael Hanson, a senior U.S. economist at Bank of America in New York, who correctly forecast the July reading. “The economy looks like it’s slowing.”
The age demographics may not be as favorable as in 2008. Gallup reports
Fifty-eight percent of U.S. registered voters aged 18 to 29 say they will "definitely vote" this fall, well below the current national average of 78% and far below 18- to 29-year-olds' voting intentions in the fall of 2004 and 2008. The 20-percentage-point deficit for young voters versus the national average compares unfavorably with six- and seven-point deficits in the later stages of the 2004 and 2008 elections, respectively.