Keeping you up to date on the latest data releases.
- Consumer Sentiment
The University of Michigan’s Index of Consumer Sentiment rose from an index level of 72.3 in July to 73.6 in early August, its highest level since May, though it is still moderately below its second quarter average of 76.3. Virtually all the traction in overall sentiment over the past few months is due to gains in the current conditions component, which jumped up 4.9 points to 87.6 in August. Consumer expectations have decreased in each of the last three months and are down almost 10 points relative to their May reading after slipping further in August to 64.5. For context, the average level for consumer expectations over the past 25 years is 80. Interestingly, consumers appear to be reacting to recent reports that severe drought conditions are going to increase food prices over the coming year. Median short-run (one-year ahead) inflation expectations jumped up from 3.0 percent in July to 3.6 percent in early August, the series’ sharpest increase since a gasoline price induced spike to 3.9 percent in March. Longer-term (five-years ahead) inflation expectations also headed higher in August, rising from 2.7 percent to 3.0 percent.