New York, NY, United States (4E) – Sentiment by U.S. consumers surprisingly dropped in July to its lowest level since March, according to a report by Thomson Reuters and the University of Michigan released on Friday.
The preliminary reading for the index declined to 81.3, compared with a final reading of 82.5 in June.
The decline was unexpected as economists expected the consumer sentiment index to rise to 83.0.
The index is closely watched by economists as an indicator of consumer spending trends. The government said earlier this week that retail sales in June increased at a slower pace than in recent months.
Meanwhile, the subindex on current economic conditions climbed to 97.1 in July from 96.6 in the prior month.
Friday’s report also showed that one-year inflation expectation inched up 3.3 percent in July from the previous month’s 3.1 percent, while the inflation outlook in the next five to 10 years dropped to 2.6 percent this month from 2.9 percent in June.