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After burst of optimism, consumer confidence sags in July

Consumer confidence, which spiked briefly during the recent stock market rally, is resetting to the levels seen earlier this year, according to the latest report from Toronto-based RBC Capital Markets.

Consumer confidence, which spiked briefly during the recent stock market rally, is resetting to the levels seen earlier this year, according to the latest report from Toronto-based RBC Capital Markets.
The RBC CASH Index, a measurement of consumer attitudes and household spending habits, was calculated at 22.4 in July, down 11.9 points from June.
The most recent reading “confirms what we first saw last month; consumers are getting realistic,” Larry Miller, RBC Capital Markets’ managing director, said in a statement.
“They’re coming to grips with the idea that we will not see a quick economic turnaround but instead face a lengthy, drawn-out recovery,” he continued.
The index is a monthly national survey of consumer attitudes on the current and future state of local economies, personal-finance situations, savings and consumers’ confidence in making large investments.
Highlights from the index’s four subindexes include the following:
After four consecutive months of rising hopes that the economy would turn around in the next six months, the RBC Expectations Index plunged from 40.9 to 4.8.
Despite unemployment reaching its highest level in 26 years, the RBC Jobs Index saw a minor uptick in July to 50.5, up 3.8 points from June.
The RBC Investment Index declined 3.5 points to 30.9. Nearly two-thirds of consumers surveyed said they are less confident now than they were six months ago in their ability to make investments for retirement and education.
The RBC Current Conditions Index, gauging current confidence, stabilized in July at 23.3 points after dropping nearly 50% in June.