Keeping you up to date on the latest data releases.
Preliminary numbers show that The University of Michigan’s Index of Consumer Sentiment slipped to 72.3 in early April from a slightly upwardly revised 78.6 in March. According to the release, unlike in past economic cycles when consumers viewed lower or stagnating incomes as a temporary departure from more favorable long term trends, consumers are now more likely to anticipate lower permanent after-tax incomes. Two topics continue to dominate the news heard and recalled by consumers. The most common are developments in jobs, on which consumers reported slightly more job losses than job gains in early April. The other topic involved negative references to government economic policies. In fact, references to all branches of the government have been more negative for a longer time (five months) than ever recorded. Consumers’ assessments of their own financial situation slipped in early April. Reports of recent after-tax income gains fell to a nine month low as 40 percent of all consumers reported that they were worse off financially than a year ago. Moreover, just 22 percent of all consumers in early April expected their financial situation to improve in the year ahead, barely above the all-time low of 20 percent last recorded in 2011.
As for inflation expectations in early April, consumers expected a year-ahead inflation rate of 3.0 percent and a longer-term (5- to 10-year) rate of 2.8 percent.