Consumer Sentiment Hits Decade High
The University of Michigan consumer sentiment reading for January was the highest that it has reached in the past decade.
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
Consumer sentiment figures for January were released by the University of Michigan. The 98.1 reading was the highest that it has reached in the past decade. January 2004 was the last time that consumer sentiment was higher, at 103.8. Despite this being the highest level in a long time, it did not beat out Bloomberg’s consensus estimate of 98.2.
The improvement is said to be due to consecutive gains in each of the past six months, with the sentiment index improving by 20% since July 2014.
The University of Michigan’s Richard Curtin said in the report:
Consumers judged prospects for the national economy as the best in a decade, with half of all consumers expecting the economic expansion will continue for another five years. The anticipated strength in the overall economy has been accompanied by more favorable income and employment expectations. While renewed strength in consumer spending will boost the pace of economic growth in 2015, most consumers are counting only on modest income gains during the years ahead. Without sufficient wage gains, consumers will be forced to demand large price discounts to complete their purchases, adding to disinflationary pressures. Overall, the more optimistic data indicate that total real personal consumption expenditures will grow at 3.3% during 2015.
The current conditions component was 109.3, and the expectations component was 91.0. Price expectations were low, at 2.5%, for one-year expectations.
Going forward, consumer spirits should be very strong, but they have yet to translate to a similar pickup in consumer spending.
ALSO READ: The Best States to Grow Old In
Contact [email protected] for any questions or corrections.
Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
