NEW YORK – Americans were as upbeat in early May as they were in April but their view of the future was the gloomiest this year as concern over high gasoline prices and Iraq began to weigh, a survey Friday showed.
The University of Michigan's (search) preliminary survey of consumer confidence showed its sentiment index held unchanged at 94.2 in early May from the final April reading, according to people who saw the subscription-only report.
Wall Street economists polled by Reuters had looked for a rise to 96.5, which would have been the highest since January given the improvement in the labor market so far this year.
"(It is) weaker than expected. Maybe not all that out of line, given all the negative stories on Iraq over the last few weeks and also the continued rise in gasoline prices. Neither of those things is a reason for dancing in the street," said Patrick Fearon, economist at AG Edwards & Sons (search) in St Louis.
The current conditions index rose to 107.2 from 105.0 in April, the strongest reading since January. But the survey's expectations index declined for the fourth month in a row to 85.8 from 87.3 in April to its lowest level so far this year.
"People recognize that the economy is getting stronger and job creation is more in their favor, but the outlook is impaired by oil prices and events abroad," said David Littman, chief economist at Comerica Bank (search) in Detroit.
"Uncertainty is overwhelming what consumers know to be better economic conditions," he said.
The University of Michigan consumer sentiment index, which is released to subscribers, is made up each month of calls to about 500 households. The preliminary survey consists of responses from about 300, while the final survey is rounded out at month-end with another 200 replies.