Consumer sentiment remains desolate as consumers fret about inflation, jobs prospects
US consumer sentiment barely budged in October, with Americans still fretting about dim job prospects and higher prices.
Overall sentiment moved from 55.1 in September to 55 in October, according to the University of Michigan’s preliminary survey of consumers. Still, sentiment is down 22% from this time last year.
“Improvements this month in current personal finances and year-ahead business conditions were offset by declines in expectations for future personal finances as well as current buying conditions for durables,” Joanne Hsu, the director of the survey of consumers, said in a statement.
Interviews with survey respondents offered “little evidence” that the federal government shutdown has so far contributed to sluggish consumer sentiment, with Americans instead caring most about “pocketbook issues like high prices and weakening job prospects.”
“At this time, consumers do not expect meaningful improvement in these factors,” Hsu said.
As market watchers trawl for breadcrumbs on the state of the US economy, since the government shutdown has so far pushed back official September data releases, the consumer sentiment data will likely receive extra attention.
Though Americans’ spending remains solid, inflation and the unemployment rate are ticking higher as consumers are increasingly expressing concern about economic conditions. The New York Federal Reserve’s consumer expectations survey, also out earlier this week, showed respondents see higher prices and greater unemployment in their future.
The University of Michigan’s consumer sentiment survey, meanwhile, found year-ahead inflation expectations moved a smidge from 4.7% in September to 4.6% in October.
Not everyone is feeling totally glum. In final sentiment results for September, Hsu noted that while consumer sentiment broadly slid that month, it held steady for Americans with large stock holdings. Higher-income households hold the bulk of US equities.
Emma Ockerman is a reporter covering the economy and labor for Yahoo Finance. You can reach her at emma.ockerman@yahooinc.com.
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