US economic recovery in doubt as confidence ebbs

Consumer confidence in the United States dropped in June after rising for three months, adding to the view the economic recovery is slowing, while single-family home prices unexpectedly climbed in April.
By The Newsroom
Published 29th Jun 2010, 23:06 BST
Updated 29th Jun 2010, 23:07 BST

A report from industry group The Conference Board, published yesterday, showed the drop in confidence came from worries about the labour

market, which has been one of weakest areas of the US economy.

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The group's index of consumer attitudes fell to 52.9 in June from a downwardly revised 62.7 in May. The June figure was sharply below the median of forecasts from analysts polled by Reuters news agency.

Assessment of the labour market also worsened, with the "jobs hard to get" index rising while the "jobs plentiful" index slipped.

Sean Simko, a fixed-income portfolio manager in Oaks, Pennsylvania, said: "There remain a lot of questions around the sustainability of economic growth."

The confidence report was at odds with last Friday's consumer sentiment data from the Thomson Reuters/University of Michigan Surveys of Consumers. That survey showed sentiment in June rose to its highest since January 2008.

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In another report, Standard & Poor's/Case Shiller home price indexes showed a final sales push before tax credits expired drove single-family home prices up in April.

The S&P index of home prices in 20 metropolitan areas for April rose 0.4 per cent on an adjusted basis. Sales have fallen since then and the market has yet to show signs of sustained recovery.