By Xavier Fontdegloria
Sentiment among U.S. consumers remained weak in July as high prices continued to erode Americans' purchasing power even as long-term inflation expectations retreated.
The final estimate of the consumer sentiment index published Friday by the University of Michigan increased to 51.5 in July from 50.0 in June. The indicator came in slightly above the mid-month preliminary reading of 51.1 and broadly matched expectations from economists polled by The Wall Street Journal.
Despite the slight increase registered in July, the indicator is near its lowest level ever recorded in the survey's history.
The one-year outlook for the U.S. economy fell to its lowest reading since 2009, while at the same time concerns over global factors have eased somewhat, said Joanne Hsu, the survey's director.
"This easing provided some limited support to buying conditions for durables, which remained near the all-time low reached last month, as well as a modest retreat in long run inflation expectations," she said.
American consumers see prices increasing 5.2% in the next year, compared with the 5.3% advance expected in June. Inflation expectations for the next five years, a closely watched indicator for Federal Reserve's officials, declined to 2.9% from the 3.1% registered in June.
"Inflation continued to dominate consumers' attention, and labor market expectations continued to soften," Ms. Hsu said.
The index measuring Americans' assessment of the current economic conditions rose to 58.1 in July from 53.8 in June, up from the preliminary early-month reading of 57.1.
However, short-term expectations remained subdued. The index of consumer expectations, which reflects the balance of respondents anticipating improved business conditions in the next six months, decreased marginally to 47.3 from 47.5 the previous month. The preliminary estimate was 47.3.
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(END) Dow Jones Newswires