Consumer confidence to hit another 'mini-boom' before a technical correction: Nik Nanos
U.S. consumer sentiment rose in June by less than forecast and longer-term inflation expectations moderated from a month earlier.
The University of Michigan’s final sentiment index increased to 85.5 from 82.9 in May, data released Friday showed. The figure was weaker than the median estimate of 86.5 in a Bloomberg survey of economists and down from a preliminary reading of 86.4.
“When the pandemic first began, consumers were quite uncertain about their job and income prospects, but reported widespread declines in market prices for homes, vehicles and household durables,” Richard Curtin, director of the survey, said in the report.
“Those favorable price references have dropped to the most negative in a decade, and job and income prospects have improved, but not quite as favorable as in the last few years of the prior expansion,” Curtin said.
Though the reading slipped from earlier in the month, the sentiment gauge is the second-highest since the pandemic began in March 2020. Consumers are becoming more optimistic as states fully reopen and new COVID-19 infections drop to pandemic lows.
The overall sentiment index, while below pre-pandemic levels, has improved considerably since the start of this year.
Consumers expect inflation to rise 4.2 per cent over the next year, the second-highest in a decade. They expect prices over the longer term to increase 2.8 per cent, compared to 3 per cent last month.
The gauge of current conditions eased to 88.6 in June from 89.4, while a measure of expectations climbed to 83.5, according to the survey.