Consumer confidence dips in July

Consumer confidence fell in July, but the overall trend remains positive amid a strengthening labor market.

The University of Michigan said Friday that its index of consumer sentiment dropped to 93.1 in July from 96.1 the previous month.

But that is still well above the 81.8 a year ago.

{mosads}The index has averaged 94.5 since December, the highest eight-month average since 2004, with the optimism attributed to “modestly positive news on jobs and wages,” according to Richard Curtin, the survey’s chief economist.

Curtin said “disappointing pace of economic growth” caused the slight dip in July’s confidence levels.

The survey showed that 10 percent of consumers referred negatively to Greece, the Chinese economy and the Trans-Pacific Partnership trade agreement, which is in the final stages of talks this week in Hawaii, but it wasn’t enough to affect sentiment much.

Overall, consumers are still expecting the economic expansion to continue, though many don’t expect much of a change in the jobs picture for the rest of the year, Curtin said.

On Thursday, the Commerce Department said that the economy expanded at a 2.3 percent pace in the April-June quarter. Growth was revised up from a contraction to 0.6 percent in the first three months of the year.

In June, employers added 223,000 jobs and unemployment dropped to a seven-year low of 5.3 percent.

The July jobs report is due out in a a week and should provide a gauge for the Federal Reserve’s plan to raise a key interest rate this year.