KONTAN.CO.ID - WASHINGTON. U.S. consumer confidence ebbed in July amid a flare-up in COVID-19 infections across the country, which is threatening the economy's recovery from an unprecedented recession caused by the pandemic.

The Conference Board said on Tuesday its consumer confidence index dropped to a reading of 92.6 this month from 98.3 in June. Economists polled by Reuters had forecast the index would drop to 94.5 in July.

The reopening of businesses has boosted economic activity in recent months, but left the country struggling to contain the resurgence in new cases of the coronavirus, forcing some authorities in the hard-hit South and West regions to either close businesses again or halt reopenings.

"Large declines were experienced in Michigan, Florida, Texas and California, no doubt a result of the resurgence of COVID-19," said Lynn Franco, senior director of economic indicators at The Conference Board. "Looking ahead, consumers have grown less optimistic about the short-term outlook for the economy and labor market and remain subdued about their financial prospects."

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The number of people submitting claims for unemployment benefits increased in mid-July for the first time since late March, when the closures of nonessential businesses almost ground the economy to a halt. The economy slipped into recession in February.

The Conference Board survey's present situation measure, based on consumers' assessment of current business and labor market conditions, rose to a reading of 94.2 this month from 86.7 in June. The expectations index based on consumers' short-term outlook for income, business and labor market conditions dropped to 91.5 from a reading of 106.1 in June.

The share of consumers expecting an increase in income was little changed at 15.1% this month and the proportion anticipating a drop rose to 15.0% from 14.1%.

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Editor: Wahyu T.Rahmawati