Consumer Economic Measures Generally Down Last Week

​Last week, consumer confidence (slightly below expectations) and consumer sentiment (up slightly) measures were released by the Conference Board. These readings provided an indication of whether citizens have enough faith in the economy to make a big purchase. Also, the Kansas City Fed Manufacturing Index (down slightly) gave a reading on manufacturing and industrial economic performance throughout the Western Great Plains. Lastly, the Mortgage Bankers Association released their weekly Mortgage Applications Survey (down).

• On Tuesday morning, The Conference Board released their monthly Consumer Confidence Index for June at 126.4. This reading came in below consensus expectations of 128.1 and was down from May’s revised level of 128.8. Economists surveyed by the Wall Street Journal concluded that a combination of factors could be placing downward pressure on consumer expectations. A volatile stock market, dwindling global growth, increased trade tensions, and rising oil prices and interest rates all may make consumers uneasy about the economic outlook. However, 126.4 remains near decade-high levels for the Index.

• The U.S. Consumer Sentiment index, not to be confused with the Consumer Confidence Index, was 98.2 in the report released Friday by the University of Michigan, up slightly from the May reading of 98.0. A preliminary report in early June reported a 99.0 expectation for the month. Furthermore, the details of the report were mixed. An index following sentiment of current conditions rose, while the index following expectations on future conditions fell. “The persistent strength has been due to favorable assessments of jobs and incomes,” the Survey’s chief economist, Richard Curtin, told the Wall Street Journal. He also stated that tensions over trade may be depressing household expectations.

• The Federal Reserve Bank of Kansas City released their monthly manufacturing report on Thursday. The June composite index was 28, down slightly from a reading of 29 in May. The index is calculated as the percentage of managers who report increases minus those who report decreases. The factory activity, raw materials inventory, and finished goods inventory indices all moved higher in June. The production index and the volume of shipments and new orders all fell throughout the month. From the selected comments section: “Business is strong right now, but tariffs and wage inflation may impact margins going forward.”

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• Weekly mortgage applications fell last week as homebuyers continue to drop out of an increasingly expensive housing market. The Mortgage Bankers Association released their weekly Mortgage Application Survey, which showed total mortgage application volume falling 4.9% from the week prior, representing the sharpest drop in four months. Housing demand had been rising in recent months with the economy’s continued strong performance. High prices, as a result of high demand and coupled with rising interest rates and concerns over trade, have homebuyers less willing to make a purchase.