Brexit drags down US consumer sentiment in July

US consumer sentiment fell in July as Brexit weighed down upper income households' expectation for economic growth.

The final reading of the consumer sentiment for July fell to 90 from 93.5 in June, said the Thomson Reuters/University of Michigan index of consumer sentiment on Friday, Xinhua news agency reported.

"The Sentiment Index was still below last month's level mainly due to increased concerns about economic prospect among upper income households," said survey director Richard Curtin.

Nearly a quarter of households with incomes in the top third said Brexit affect their confidence for the economy, while only 11 percent of the households with incomes in the bottom two-thirds shared the same concerns, said the survey.

The concerns about Brexit are likely to quickly recede as stock prices have rebounded and the direct impact on US trade is tiny, said Curtin.

But "uncertainties surrounding global economic prospects and the presidential election will keep consumers more cautious in their expectations for future economic growth," said Curtin.

The sub-index of current conditions, reflecting Americans' perceptions of their financial situation and whether they consider it a good time to buy big-ticket items like cars, slid to 109 from 110.8 last month.

The sub-index gauging consumer expectations for six months from now, which more closely projects the direction of consumer spending, decreased to 77.8 from 82.4 in June.

--IANS

pgh/