Consumer Sentiment Turns Lower in Early July

Ann Arbor, MI, July 16, 2010--Consumer sentiment weakened in early July to its lowest in 11 months, according to Thomson Reuters/University of Michigan's Surveys of Consumers.

The reversal in consumer sentiment was dramatic after it reached its strongest level in nearly 2-1/2 years last month on hopes of better job and credit conditions,

The survey's preliminary July reading on the overall index on consumer sentiment fell to 66.5 from 76.0 in June. The figure was below the median forecast of 74.5 among economists polled by Reuters.

"Income and job prospects were extraordinarily weak and those bleak prospects have made consumers much more cautious spenders," Richard Curtin, director of the surveys, said in a press release.

"Moreover, consumers reported renewed weakness in the economy and were more likely to anticipate additional problems in the year ahead," Curtin said.

The survey's measure of current economic conditions tumbled to 75.5 in early July, the lowest since November 2009.

This compared with 85.6 in June, which was the highest since March 2008. Analysts had predicted a figure of 84.0 for early July.