WASHINGTON - Americans' confidence in the economy fell only slightly in July but stayed close to a 5 year high, a sign that consumers should continue to help drive growth in the coming months.
The Conference Board, a New York-based private research group, said Tuesday that its consumer confidence index dipped to 80.3 in July. That's down from a reading of 82.1 in June, which was revised slightly higher and the best reading since January 2008.
Despite the slight drop in July, confidence remains well above year-ago levels. And consumers are more optimistic about the current job market.
In this Sunday photo, Lee Greenwood, of Southfield, Mich., loads his car after shopping at the soft opening of the new Meijer store, the first one in Detroit. The private Conference Board reports on consumer confidence for July on Tuesday.
"Overall, indications are that the economy is strengthening and may even gain some momentum in the months ahead," said Lynn Franco, an economist for the Conference Board that oversees the consumer confidence survey.
Amna Asaf, an economist at Capital Economics, blamed the July drop in confidence on rising gasoline prices. But she said the confidence index remains at a level that is consistent with stronger growth in consumer spending in the July-September quarter.
Consumers' confidence in the economy is watched closely because their spending accounts for about 70 percent of U.S. economic activity.
The index surged in June, coinciding with a stronger job market. Employers added 195,000 jobs in June and many more in April and May than initially reported. That brought the monthly job growth up to an average of 202,000 in the first six months of 2013, up from 180,000 a month in the final six months of last year.
The government releases the July employment report on Friday. Economists forecast that employers added 183,000 jobs, and the unemployment rate fell to 7.5 percent from 7.6 percent in June.
A recovery in housing is also boosting confidence, and a separate report Tuesday offered more encouraging news on that front.