"Consumers' upbeat mood about current business and labor conditions underscores the economy's continuing recovery, but the latest retreat in expectations suggest that the pace of economic growth will not accelerate in the months ahead," said Lynn Franco, director of The Conference Board's Consumer Research Center.

More than 21 percent of consumers rate current business conditions as "good," up from 19.7 percent in April, and 18.8 percent label current conditions as "bad," down from 19.4 percent in April.