Consumer sentiment builds momentum as inflation continues to slow University of Michigan News

On balance, consumer views remain on an upward trajectory; sentiment is now more than 40% above the June 2022 trough, though it remains well below pre-pandemic readings. “We expect the earnings momentum to continue with a steady growth of ~15% over the next 2 years (FY24-26). Overall we expect the market to consolidate in a broader range and take cues from global factors,” said Siddhartha Khemka, Head – Retail Research, Motilal Oswal Financial Services. Consumer concerns over high interest rates for durable goods reached their lowest levels in two years, which will likely provide some support for consumers’ willingness to make these purchases in the months ahead. Consumers’ views of labor markets became more favorable in October, Hsu said.

The US economy does not, of course, become simultaneously better or worse on Election Day. Nor do regulations, taxes and the overall ease of doing business suddenly change the first Tuesday after the first Monday in November. But for people with partisan leanings, a simple change in the party occupying the White House alters the lens through which people see things. When voters serve their party an eviction notice, everything comes up grey. Three-plus years of high inflation have compounded to sap away purchasing power and savings account balances. Credit card debt is on the rise and so are Bollinger bands strategy delinquencies, in a time of inflation-fighting high interest rates.

Consumer sentiment holds steady amid renewed concerns over high prices

Overall, consumer sentiment is 40% higher than it was in June 2022, when inflation peaked at 9.1%. When asked whether unemployment or inflation will pose the more serious problem for consumers in the next year or so, about 42% of consumers chose inflation, down from 53% just four months ago. Furthermore, consumers expect inflation to continue slowing over the course of the next year, Hsu said. The Michigan Consumer Sentiment Index has provided a relatively accurate forecast of future consumer confidence and spending for the past several decades. For more information about the Michigan CSI and its impact on economic analysis, consult your investment advisor or log on to the Surveys of review mba asap 10 minutes to: understanding corporate finance Consumers, University of Michigan website.

Consumers have recognized that inflation has eased substantially over the past two years, and they generally do not expect inflation to come roaring back, Hsu said. However, they showed concerns that the slowdown in inflation may have stalled; signs of their frustration over high prices were visible throughout the survey. Consumer sentiment rose to its highest reading since May 2024, increasing for the second straight month and lifting more than 3% above August, according to the University of Michigan’s Survey of Consumers. The Consumer Sentiment Index rose to 71.8 in the November 2024 survey, up from 70.5 in October and above last November’s 61.3.

• “Consumers may feel really bad about the inflation; but when push comes to shove, for many of them, they have the income, the spending power that can fuel a pretty decent holiday shopping season,” he said.
• The Michigan Consumer Sentiment Index is another key indicator designed to illustrate the average U.S. consumer’s confidence level.
• Less than one-third of consumers expect unemployment rates to rise in the year ahead, compared with 41% a year ago.
• And when excess stock piles up in the back room and in the warehouses, the solution typically involves slashing prices to help move it out the door.
• MSCI’s broadest index of Asia-Pacific shares outside Japan edged up 0.2%, having rallied 2.8% last week.

Aster DM Healthcare share price

“Consumers may feel really bad about the inflation; but when push comes to shove, for many of them, they have the income, the spending power that can fuel a pretty decent holiday shopping season,” he said. Inflation remains top of mind for consumers and a major concern; however, wage gains have outpaced the rate of price hikes for the past year and a half, Wise said. While the extent of vulnerability cuts differently across households and socioeconomic brackets, overall holiday sales are expected to rise 3.3% this year, according to Wells Fargo projections. While it’s not an excessive amount of discounting, retailers are aware that consumers are price-fatigued and have some spending fatigue around discretionary items, she said.

Popular in Markets

There’s typically hesitation in spending leading up to the election, but after November 6, it hit different for many customers of Mischief, which has a focus on diversity, social justice and other community-centric causes. This year, there are 26 days between Thanksgiving and Christmas, marking the shortest holiday shopping season possible. A short shopping season, however, may force the hands of retailers who are looking to hold back on deep promotions. At B&B’s locations in New Jersey, the recipe for success from past years will still be cooked up this time around, Jeffrey Davidson, B&B’s executive vice president, told CNN. “The consumer has got firepower and is able to out and spend, so it’s not going to be a miserable holiday by any standards,” said Neil Saunders, retail analyst and managing director at GlobalData Retail. Americans plan to spend $902 on average this year on gifts, food, decorations and other seasonal items, the National Retail Federation projected, citing its latest consumer survey.

Seasonal Transitions and Climate Change

The simple truth is that neither party is inherently good or bad for markets. The two longest, most brutal bear markets in recent memory (2000 – 2002 and 2007 – 2009) started how to write rfp for software under one party and continued under the other. In a way, Exhibits 1 and 2 show people subconsciously know this, as the red and blue lines move in the same direction the vast majority of the time, apart from those flips around the elections. Most of the time, they see and acknowledge the same trends, just with a greater or smaller degree of underlying cheer based on the White House’s occupant.

“Despite the political polarization in the consumer sentiment reports, on balance the index is still trending higher. Lower gas prices, gains in equity markets, and falling interest rates have all given consumers something to be more optimistic about,” according to the research note released Friday. The preliminary report is generally released during the middle of the month and covers survey responses collected in the first two weeks of the month. The final report is released at the end of the month and covers the full month.

Sentiment for consumers mentioning food were substantially higher than for those who did not, suggesting that high prices of food continue to weigh on a sizable share of consumers. The consumer confidence measures were devised in the late 1940s by Professor George Katona at the University of Michigan. They have now developed into an ongoing, nationally representative survey based on telephonic household interviews. The Index of Consumer Expectations (a sub-index of ICS) is included in the Leading Indicator Composite Index published by the U.S. Consumer sentiment is a statistical measurement of the overall health of the economy as determined by consumer opinion.