In June, the first estimate of University of Michigan consumer confidence dropped from 74.3 to 71.8, while the consensus was looking for only a slight weakening in consumer sentiment. Looking at the details, sentiment about both the economic conditions (789.6 from 81.9) and economic outlook (66.8 from 69.5) weakened in June, probably due to the disappointing economic data of recent, which created uncertainty about the sustainability of the recovery in the US. Also the awful payrolls report and the drop in equity prices might have worsened consumer confidence recently. Overall however the deterioration in consumer sentiment remained limited as the headline index only gave back part of the previous month’s gain. 1-year ahead inflation expectations eased slightly from 4.1% Y/Y to 4.0% Y/Y, while 5-year ahead inflation expectations rose slightly from 2.9% Y/Y to 3.0% Y/Y.