March Consumer Sentiment Rose from Preliminary Expectations

Ann Arbor, MI, April 1, 2016—Consumer sentiment fell 0.8% in March to 91.0 from February’s 91.7 mark, according to the final results from the University of Michigan’s Survey of Consumers.

This represents a 2.2% decrease year over year.

“Consumer confidence inched upward in late March due to more favorable economic expectations, but the gain still left the Sentiment Index slightly below last month's level,” said Survey of Consumers chief economist, Richard Curtin. “Despite the recent small monthly variations, the overall level of confidence has remained largely unchanged during the past nine months: the Sentiment Index in the 1st quarter of 2016 averaged 91.6, barely different from the 91.3 in the 4th quarter or the 90.7 in the 3rd quarter of 2015. This stability reflected more positive personal finances being offset by less favorable prospects for the economy. Indeed, consumers were more optimistic about their inflation-adjusted income expectations than any time since 2007. Consumers anticipated that the slower pace of economic growth will more than likely put an end to further declines in the unemployment rate. What was surprising was that the expectations of higher gas prices and higher unemployment have not caused an increase in uncertainty about personal financial prospects. To be sure, the positive outlook for consumer spending is contingent on the view held by most consumers that the jobless and inflation rates will be maintained close to their current low levels. Overall, the data still indicate a 2.7% rate of growth in personal consumption during 2016.”

Mid-month, consumer sentiment for March 2016 was reported at 90.0.