Consumer Sentiment Rose 3.6% in August to 96.8

Ann Arbor, MI, September 1, 2017-Consumer sentiment rose 3.6% in August to 96.8, according to the final results from the University of Michigan Survey of Consumers.

This represents a 7.8% increase year over year.

“Consumer confidence has remained at a very favorable level, although slipping somewhat from mid-month,” according to chief economist, Richard Curtin. “The Sentiment Index has been higher during the first eight months of 2017 than in any year since 2000, which was the peak year of the longest expansion in U.S. history. The renewed strength in 2017 was mainly due to consumers' favorable assessments of their own financial situations. Lows in unemployment, inflation, and interest rates, as well as renewed gains in the value of their homes and stock portfolios, pushed personal financial evaluations to near all-time peaks. When asked about news of recent developments, surprisingly few consumers made any reference to Charlottesville, North Korea, or Harvey-although too few interviews were conducted to fully assess the storm's ultimate impact. Harvey may diminish the 3rd quarter pace of economic growth, and higher gas prices will directly impact consumers. Prior to the storm, consumers anticipated no increase in gas prices in the year ahead (an expected change of just +0.4 cents). Given the current resilience of consumers, temporary increases in gas prices as well as a brief period of weakness in economic growth and employment are unlikely to derail confidence. Nonetheless, all of these events are more likely to increase precautionary motives and to slightly temper spending trends.”