August 10, 2021 – The July Conference Board Consumer Confidence Index increased slightly to 129.1 from an upwardly revised 128.9 in May, with the present situation component increasing by 0.7 points to 160.3, just 6.4 points below the pre-pandemic reading. The expectations component held steady, moving down by just 0.1 point, indicating that consumers remain positive about the continued recovery through the remainder of the year.
Both components of the index—present situation and future expectations—are approaching pre-pandemic levels, with consumer optimism in the recovering economy, income expectations, business conditions, the labor market, and the hope of a return to normalcy within the year all contributing to the index’s strength. Regional differences are becoming more prominent, however, and seem to be linked to areas where COVID-19 cases are on the rise.
The next several months will be telling for the potential of further regional divergence in consumer confidence and the continued strength of the economic recovery. The Delta variant has yet to truly impact confidence levels, but a resurgence of case counts or associated shutdowns in the remainder of summer could still impact the fragile consumer mood.