Consumer Sentiment Posted Small Rebound in Early September
Ann Arbor, MI, September 13, 2019-Consumer sentiment for early September rose 2.4% to 92.0, according to preliminary results from the University of Michigan.
This amounts to a 8.1% decline year over year.
“Consumer sentiment posted a small rebound from the sharp August decline, marking the third lowest level since Trump's election,” says Survey of Consumers chief economist, Richard Curtin. “While the uptick was across both current and expected economic conditions, the early September rebound was not widespread across age or income subgroups as it only fell among consumers under age 45 and among households with incomes in the top third---these two groups account for about half of all spending. The data do indicate that consumers anticipate that the Fed will cut interest rates next week, with net declines in interest rates more frequently expected at present than any time since the depths of the Great Recession in February 2009 (see the chart). These expectations are likely to diminish the impact on spending from a quarter-point rate cut, but if rates remain unchanged, it may increase negative reactions by consumers. Concerns about the impact of tariffs on the domestic economy also rose in early September, with 38% of all consumers making spontaneous references to the negative impact of tariffs, the highest percentage since March 2018. Those who negatively mentioned tariffs also held more negative views on the overall outlook for the economy as well as anticipated higher inflation and unemployment in the year ahead. While a recession is not anticipated in the year ahead, neither is a resurgence in personal consumption. The outlook for consumption is for a slower but positive growth, keeping the expansion going for another year.”