Spending confidence has improved in June—especially in discretionary goods—suggesting that retail sales will improve from last month’s letup.
The improvement in the Spending Confidence Index™ among discretionary goods is especially evident in clothing, homegoods, and leisure goods. Among consumable goods, confidence has lagged in food and grocery, but has picked up in the health and beauty category.
The Index and its components are measures of consumer sentiment created by MacroSavvy™ in partnership with Prosper Insights & Analytics™. The white paper at this link explains why the new index is an improvement over existing measures of confidence.
The summary scorecard shows the clearer insight into consumer sentiment provided by the new index compared with the other more widely followed measures of confidence.
The latest data on the consumer confidence index from the Conference Board and the consumer sentiment index from the University of Michigan show a mix of components moving in opposing directions on a month-to-month and year-to-year basis.
Meanwhile, the Spending Confidence Index™ indicates:
A month-to-month pickup. The pickup in spending confidence is partly the result of a comparison to relatively weak prior month. Confidence remains up year-to-year and year-to-date at rates that are close to the trend of the past year.- Discretionary goods strength. The month-to-month pickup was strongest in discretionary goods categories, particularly clothing, homegoods, and leisure goods.
- Consumable goods lag. Although spending confidence in consumable categories picked up in June, it remains relatively weaker compared with discretionary goods. This partly reflects weak or declining prices in food and grocery categories, given the related price trends.
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