US Consumer Sentiment Spikes to 13-Year Highs
US consumer sentiment (MSI) rose to a 13-year high as Americans’ perceptions of the economy and their own finances rebounded following several major hurricanes, a University of Michigan survey showed Friday.
|Highlights of Michigan Sentiment (October, preliminary)|
The spike in sentiment, which was greater than any analyst had projected, may reflect several trends: falling gasoline prices following a hurricane-related spike; repeated record highs for the stock market; a 16-year low in unemployment; and post-storm recovery efforts driving a rebound in economic growth.
Not all measures in the survey showed big gains: the share of consumers reporting improved finances held steady at about half, while the proportion expecting gains in their financial situation fell slightly to 40%.
“While the early October surge indicates greater optimism about the future course of the economy, it also reflects an unmistakable sense among consumers that economic prospects are now about as good as could be expected,” Richard Curtin, director of the University of Michigan Consumer Survey, said in a statement.
“Indeed, nothing in the latest survey indicates that consumers anticipate an economic downturn anytime soon, which contrarians may consider a clear warning sign of trouble ahead.”
- 83% of respondents saw buying conditions for household durable’s as favorable, most in more than a decade; positive vehicle-buying attitudes at 75%, highest since Y 2004
- Consumers saw inflation rate in the next year at 2.3% after 2.7% the prior month
- Inflation rate over next 5 to 10 years seen at 2.4% after 2.5% in September
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