Keeping you up to date on the latest data releases.
Preliminary numbers show that the University of Michigan’s Index of Consumer Sentiment fell to 82.7 in early June from 84.5 in May. Survey respondents viewed current economic conditions as worse than last month, dropping 5.9 percentage points. This is the largest monthly drop in present conditions since August 2011. Among the top third of the income distribution, the sentiment index rose to 96.1 in June from 94.1 in May, the highest level recorded during this recovery. The majority of the index pullback was among lower income households. Consumers were still slightly more optimistic about future economic outlook, which rose 0.9 percentage points. When asked about prospects for the national economy during the year ahead, consumers are more optimistic than any other time since mid-2007. Unemployment expectations were mixed with fewer consumers expecting either increases or declines during the year ahead for unemployment. Finally, buying attitudes toward household durables declined among lower income households, while vehicle buying attitudes declined among upper income households. Even with these attitude declines, the survey points to the current attitudes being more favorable than any time in the past year.
As for inflation expectations in early June, consumers expect a year-ahead inflation rate of 3.2 percent and a longer-term (five- to ten-year) rate of 3.0 percent.