Consumer sentiment fell 1.8 points in September after holding steady for the past two months but is still 9.1 points higher than a year ago. The Current Economic Conditions Index decreased 5.9 points from the previous month to 69.8 but is 10.1 points above the September 2022 index. The Consumer Expectations Index increased 0.8 points to 66.3 from the last month and is 8.3 points higher than a year ago.
“Consumer sentiment inched down a scant 1.8 index points this month and has been essentially flat for the past two months. At 67.7 points, sentiment is currently about 35% above the all-time historic low reached in June of 2022 but remains shy of the historical average reading of 86. Sentiment this month was characterized by divergent movements across index components and across demographic groups with little net change from last month. Notably, though, both short-run and long-run expectations for economic conditions improved modestly this month, though on net consumers remain relatively tentative about the trajectory of the economy. So far, few consumers mentioned the potential federal government shutdown, but if the shutdown comes to bear, consumer views on the economy will likely slide, as was the case just a few months ago when the debt ceiling neared a breach.”
“Year-ahead inflation expectations moderated from 3.5% last month to 3.1% this month. The current reading is the lowest since March 2021 and is just above the 2.3-3.0% range seen in the two years prior to the pandemic. Long-run inflation expectations came in at 2.7%, falling below the narrow 2.9-3.1% range for only the second time in the last 26 months.”, said Surveys of Consumers Director Joanne Hsu.
Read the University of Michigan Surveys of Consumers release.