Rising COVID-19 cases dent US consumer confidence; housing market presses ahead

U.S. consumer confidence fell more than expected 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 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 slipping to 94.5 in July. Economists have credited the additional US$600 in weekly unemployment benefits for the rebound in economic activity. The supplement is part of a historic fiscal package of nearly US$3 trillion. With a staggering 31.8 million people collecting unemployment checks in the first week of July, economists have warned against letting this supplement expire.

The survey's so-called labor market differential, derived from data on respondents' views on whether jobs are plentiful or hard to get, improved to a reading of 1.3 this month from -2.8 in June. That measure closely correlates to the unemployment rate in the Labor Department's employment report. It has dropped from as high as 38.3 in August last year.

In a separate report on Tuesday, the Commerce Department said the homeownership rate jumped a record 2.6 percentage points in the second quarter to 67.9per cent, the highest since the third quarter of 2008.

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