The 1st look at June UoM confidence at 74.1 was light relative to expectations of 77.5, down from 79.3 in May and the lowest of the year. The decline was about equally spread between the two components as Current Conditions fell by 5.1 pts and the Outlook was down by 5.4 pts. One year inflation expectations were unchanged at 3.0%, matching the lowest since Dec ’10 primarily due to the recent drop in gasoline prices. As confidence is a coincident indicator and tells us nothing about the economic goings on in the future, the June decline likely reflects the lackluster labor market as seen in the data over the past few months and maybe the euro debt mess as the UoM survey is done over the phone just within the last few days thus capturing the nervousness many of us are feeling.
