- Wednesday, October 16, 2024
The sentiment among U.S. consumers experienced a slight dip in August, as the recent economic improvements lost some momentum due to a rise in inflation. According to data from a survey conducted by the University of Michigan, the final reading of the consumer sentiment index decreased from 71.6 in July to 69.5 in August.
Economists had anticipated the indicator to be at 71.2, which aligns with the preliminary estimates made in mid-August. It's worth noting that July's level is the highest it has been for a full month since October 2021.
Survey director Joanne Hsu explained that consumer sentiment moved sideways in August after experiencing significant growth over the past few months. Consumers perceived that the rapid improvements in the economy, particularly with regard to inflation, have moderated. As a result, they are feeling uncertain about the future outlook.
In July, U.S. annual inflation rose to 3.2% from 3.0% in June. However, core inflation, which indicates underlying pressures in the economy, slightly decreased to 4.7% in July compared to June's level of 4.8%.
The data also revealed that readings for current economic conditions and consumer expectations both showed a slight decline month-on-month.
Inflation expectations for the next five years, a closely monitored indicator by Federal Reserve officials, remained unchanged at 3.0% for both June and July.
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