U.S. Consumer Confidence Leaps as Inflation Expectations Dip - University of Michigan
23 December 2023 - 2:50AM
Dow Jones News
By Ed Frankl
Sentiment among U.S. consumers jumped in December, a little
higher than in initial estimates, amid stronger expectations for
cooling inflation in 2024.
The final reading of the consumer sentiment index rose to 69.7
in December from 61.3 in November, according to data from a survey
carried out by the University of Michigan released Friday.
Economists polled by The Wall Street Journal had expected the
indicator to be at 69.4, the same as the preliminary estimate made
in mid-December.
The reading reversed all declines from the previous four months,
driven by improvements in how consumers view the direction of
inflation, according to survey director Joanne Hsu.
Consumers' expectations for inflation fell to 3.1% in December
from 4.5% last month--the lowest since March 2021--the data said.
Slowing inflation prompted Federal Reserve Chair Jerome Powell to
pivot from talking up monetary tightening toward considering when
to cut interest rates at the central bank's meeting last week.
Driven by more hopeful expectations for business conditions, all
five index components of the University of Michigan indicator rose
this month, something which has only occurred in 10% of readings
since 1978, Hsu said.
"The index is now just shy of the midpoint between the
prepandemic reading and the historic low reached in June 2022," she
added.
All age, income, education, geographic, and political
identification groups saw gains in sentiment this month, according
to the survey.
Write to Ed Frankl at edward.frankl@wsj.com
(END) Dow Jones Newswires
December 22, 2023 10:35 ET (15:35 GMT)
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