Survey measuring consumers' views a bit more upbeat Mich. poll suggests moderate growth

June 19, 1993|By Bloomberg Business News

NEW YORK -- The University of Michigan's consumer sentiment index for June rose to 82.8, from 80.3 in May, suggesting moderate economic growth ahead, analysts said.

Even with the increase, the index remains below the post-election high of 91 set in December. The index was most recently this high in April.

"We're not seeing any major improvement" in consumer confidence, said Marilyn Schaja, an economist at Donaldson, Lufkin & Jenrette. "We're still below the first-quarter" average of 87.3 in the Michigan measure, which suggests that the economy will grow at a pace of 2 percent to 3 percent in the months ahead.

The record high for the sentiment index, which the university releases to clients, is 97.9, set in January 1989. The record low is 63.9, set in October 1990.

Darwin Beck, an economist at First Boston, said the Michigan report "suggests nothing other than moderating" economic expansion.

The university also reported that its early June index of consumer expectations rose to 71.1, from 68.5 in May. The early June index of economic conditions rose to 101, from 98.7 in May.

The readings are subdued because "employment conditions are still mediocre, and a lot of people are still nervous about taxes," Ms. Schaja said. President Clinton's plan to cut the federal budget deficit by $500 billion over five years includes tax increases of about $250 billion.

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