US consumer confidence likely dipped in July

The Conference Board releases its June index on U.S. consumer confidence Tuesday at 10 a.m. Eastern.

CONFIDENCE DIPS: Economics expect that consumer confidence will slip to 100 in June, according to a by data firm FactSet. Optimism likely moderated this month after jumping sharply in June. Confidence climbed to 101.4 last month after a May reading of 94.6. The index has increased 17.4 percent over the past year.

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HIRING BOLSTERS CONFIDENCE: A multi-year hiring streak has lifted certainty about the job market and business conditions, but the absence of meaningful wage growth has limited the benefits from the improving consumer sentiment.

Employers have steadily added jobs since the beginning of 2014, creating an average of 242,556 jobs each month and the unemployment rate has fallen to 5.3 percent from 6.7 percent during that time.

Rising confidence generally points to increased consumer spending, which helps to drive overall economic growth. Consumers account for roughly two-thirds of all U.S. economic activity.

Still, the Confidence Board survey of consumers found in June that few people expected the job gains to translate into pay hikes. Average hourly incomes have risen 2 percent over the past year, only slightly ahead of core inflation. The absence of larger pay raises has kept Americans cautious and retail sales fell 0.3 percent in June, according to the Commerce Department.

The government will report Thursday on gross domestic product during the April-June quarter. The economy contracted 0.2 percent during the first three months of the year, pummeled by winter weather and global economic pressures that caused the dollar to rise in value and hurt the affordability of U.S. made goods abroad.

Economists say that the country likely returned to growth in the second-quarter, expanding at a 2.7 percent annualized pace.

A separate survey of consumer sentiment compiled by the University of Michigan that was released this month showed a preliminary decline in sentiment from June to July.