In September, U.S. consumers’ sentiment increased a little bit as inflation expectations moderated

October 3, 2022

As a result of lower energy prices and lowered inflation predictions, consumer sentiment in the United States increased slightly in September to its best level in five months.

The final estimate of the University of Michigan’s consumer mood index rose to 58.6 in September from 58.2 in August and was released on Friday. However, the index decreased from the preliminary mid-month figure of 59.5.

Consumer sentiment was predicted to remain unchanged from the initial assessment by economists surveyed by The Wall Street Journal.

According to Joanne Hsu, the survey’s director, the buying conditions for durable goods and the one-year economic outlook both improved from their extremely low readings earlier in the summer. However, these improvements were largely offset by slight declines in the long-term outlook for business conditions.

Despite recent gains in the index, consumer confidence in the United States is still at historically low levels due to worries about inflation and a slowing economy. From 8.5% in July to 8.3% in August, US inflation modestly decreased.

For the third month in a row, Americans’ short-term inflation forecasts decreased in September. The United States’ forecast for price growth in 2019 is 4.7%, the lowest level since September 2021 and down from 4.8% in August.

A key measure for the Federal Reserve’s officials, expectations for inflation over the next five years, fell from 2.9% in the previous month to 2.7% this time around. The long-term inflation predictions are below the 2.9% to 3.1% range for the first time since July 2021.

Source: MarketWatch
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