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After three straight months of improvement, the Conference Board's consumer confidence index reversed course in May, dipping 0.7 points to 93.1, as concerns about the inflationary fallout from the ongoing Middle East war dragged on Americans' assessment of current conditions.
The index fell from an upwardly revised 93.8 in April. Economists surveyed by Reuters had forecast a reading of 92.0, according to Yahoo Finance. Economists polled by The Wall Street Journal had also anticipated a reading of 92.0, according to the Journal.
The Present Situation Index, which measures consumers' assessments of current business and labor market conditions, retreated 3.2 points to 121.2, a three-month low, the Conference Board said. The Expectations Index, which captures consumers' six-month outlook for income, business, and labor conditions, rose 1.0 point to 74.4, its highest level this year, according to Bloomberg.
"Consumer confidence edged downward in May as the inflationary impacts of the war in the Middle East intensified," Dana M. Peterson, chief economist at the Conference Board, said in a statement. "References to prices and oil and gas increased in frequency for a second consecutive month, while mentions of war, geopolitics, and conflict remained elevated — likely signaling consumers' underlying concerns about the inflationary impacts of the war in the Middle East on their wallets."
