Consumer sentiment jumped 7.9 percent month-to-month to 63.9 in the first two weeks of June, reaching its highest level in four months, according to preliminary data from a consumer survey conducted by the University of Michigan.
Economists polled by FactSet expected sentiment to improve to 60 percent after sliding 7 percent to 59.2 in May.
The Index of Consumer Sentiment was up 27.8 percent year-over-year. The Current Economic Conditions reading was up 4.8 percent month-to-month and 26.4 percent year-over-year to 68.0. The Index of Consumer Expectations reached 61.3, up 10.6 percent month-over-month and 29.1 percent year-over-year.
Surveys of Consumers Director Joanne Hsu said, “Consumer sentiment lifted 8 percent in June, reaching its highest level in four months, reflecting greater optimism as inflation eased and policymakers resolved the debt ceiling crisis. The outlook over the economy surged 28 percent over the short run and 14 percent over the long run. Sentiment is now 28 percent above the historical low from a year ago and may be resuming its upward trajectory since then. As it stands, though, sentiment remains low by historical standards as income expectations softened. A majority of consumers still expect difficult times in the economy over the next year.
“Year-ahead inflation expectations receded for the second consecutive month, falling to 3.3 percent in June from 4.2 percent in May. The current reading is the lowest since March 2021. In contrast, long-run inflation expectations were little changed from May at 3.0 percent, again staying within the narrow 2.9-3.1 percent range for 22 of the last 23 months. Long-run inflation expectations remained elevated relative to the 2.2-2.6 percent range seen in the two years pre-pandemic.”
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