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Consumer sentiment slips to 3-month low

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WASHINGTON (6/16/14)--Confidence among consumers dipped in early June to its lowest point in three months, according to the University of Michigan and Thomson Reuters Consumer Sentiment Survey ( MarketWatch June 13).

The survey's consumer confidence index dropped to 81.2 from May's last reading of 81.9, a number well below what analysts had expected for the beginning of the month.

Despite the slip in survey numbers, buyers reported feeling rosier about their current financial situations.

"Continued improvement in labor market conditions and the ongoing wealth effect from rising equities and home prices should continue to make consumers more comfortable in purchasing big ticket items over the coming months," Gennadiy Goldberg, U.S. strategist from TD Securities told MarketWatch.

Long-term optimism has waned, however, as expectations have grown dim for the economy in the coming months, according to one subindex in the survey.

Moody's analysts said that tensions overseas between Russia and Ukraine, in addition to the recent outbreaks of violence in Iraq, may be hurting confidence ( Economy.com June 13).

Shoppers expect prices to rise 3% over the next year, according to Economy.com , a drop from May's expectations of 3.3%.

Five-year projections for inflation rose, however, to 2.9%, from 2.8% in May.