US Consumer Sentiment Falls on Deteriorating Inflation, Labor Outlook

Contact Your Elected Officials

โ€˜This deterioration largely stems from rising worries about inflation,โ€™ says the University of Michiganโ€™s surveys head.

U.S. consumer sentiment unexpectedly softened in August, as the public anticipates inflation and unemployment to worsen in the future, according to new data from the University of Michigan Surveys of Consumers, released on Aug. 15.

The preliminary August consumer sentiment index fell to 58.6, down from a final reading of 61.7 in July. This came in below the consensus forecast of 62 and represented the first decline in four months.

The index for current conditions dropped to 60.9 from 68, and the expectations metric fell to 57.2 from 61.7. Both readings are down by 0.7 percent and 20.7 percent, respectively, from a year ago.

โ€œThis deterioration largely stems from rising worries about inflation,โ€ Joanne Hsu, director of the Surveys of Consumers, said in a statement.

Consumers, Hsu says, are increasingly concerned about their current purchasing power. Buying conditions for durables declined by 14 percentโ€”the lowest reading in a yearโ€”mainly because of higher prices, she noted.

โ€œOverall, consumers are no longer bracing for the worst-case scenario for the economy feared in April when reciprocal tariffs were announced and then paused,โ€ Hsu stated. โ€œHowever, consumers continue to expect both inflation and unemployment to deteriorate in the future.โ€

The year-ahead inflation expectations rose to 4.9 percent from the five-month low of 4.5 percent in July. The five-year outlook also climbed to 3.9 percent, up from 3.4 percent in the previous month.

Despite the uptick, both short- and long-term projections remain below their highs observed in April and May.

Receding consumer sentiment did not prevent shoppers from opening their wallets.

In July, retail sales increased by 0.5 percent following an upwardly adjusted 0.9 percent increase in June.

Additionally, two categories sensitive to tariffsโ€”apparel and automobilesโ€”increased from a year ago. Receipts at clothing stores and motor vehicle and parts dealers jumped at a seasonally adjusted pace of 5 percent year over year.

The retail sales control groupโ€”a key metric that feeds into gross domestic product calculationsโ€”climbed by 0.5 percent, โ€œsuggesting recession risks remain minimal,โ€ says LPL chief economist Jeffrey Roach.

โ€œAdjusted for inflation, retail sales rose 0.3 percent and indicated the consumer is successfully handling the trade uncertainty,โ€ Roach said in a note emailed to The Epoch Times.

โ€œRecession risks remain low.โ€

Consumer spending accounts for two-thirds of economic activity and is a critical measure of the broader economyโ€™s health. Following a 0.5 percent contraction in the first quarter, the U.S. economy rebounded by 3 percent. Early estimates, including from the Federal Reserve Bank of Atlantaโ€™s GDPNow Model and the New York Fed Staff Nowcast, point to at least 2 percent growth.

By Andrew Moran

Read Full Article on TheEpochTimes.com

The Epoch Times
The Epoch Timeshttps://www.theepochtimes.com/
Tired of biased news? The Epoch Times is truthful, factual news that other media outlets don't report. No spin. No agenda. Just honest journalism like it used to be.

โ€˜He Didnโ€™t Care That I Was a Malcom X Scholarโ€™

The rise of delusional social justice ideology is the result of impressionable youth being influenced by overpaid professors and administrators.

5 Family-friendly History Movies

Family-friendly history movies you can enjoy with your kidsโ€”perfect for homeschool projects or a fun way to learn together as a family.

The hard truth of pretual social change

History shows us a progression of dominant social structures, each one born from innovation and is eventually replaced by another.

British Court: Migrants Officially Supplant Natives in โ€˜Hierarchy of Rightsโ€™

So-called โ€œasylum seekersโ€ (economic migrants) enjoy superior rights to British people in Britain as defined by the European Convention on Human Rights.

Paid Protesters Money Sources Exposed

Journalist Nate Friedman uncovered that a New York City protest was staged, featuring paid demonstrators with pre-made signs rather than organic activism.

CBS Changes Policy for โ€˜Face the Nationโ€™ Interviews After Kristi Noem Interview

CBS News will stop editing guest interviews on โ€œFace the Nation,โ€ shifting to live or live-to-tape after backlash over its Kristi Noem interview.

ICE Changes Deportation Location for Kilmar Abrego Garcia to Eswatini

ICE informed Kilmar Abrego Garciaโ€™s lawyers that Eswatini will replace Uganda as the deportation country for the El Salvadoran.

Chagas Disease, Transmitted by โ€˜Kissing Bugs,โ€™ is Now Considered Endemic in the US: UCLA

Chagas disease, an illness transmitted by โ€œkissing bugs,โ€ is now considered endemic in the United States, said UCLA citing recent CDC report.

2 Teens Arrested in June Killing of Congressional Intern in DC, US Attorney Says

Two teens were arrested for the June murder of a congressional intern in Washington, D.C., U.S. Attorney Jeanine Pirro announced.

Trump Signs Order Renaming Department of Defense as Department of War

President Donald Trump on Sept. 5 signed an executive order renaming the Department of Defense as the Department of War.

Trump Sends Warning to Venezuela After US Military Strikes Boat Allegedly Carrying Drugs

President Trump sent a warning to Venezuela after the U.S. military struck what the administration says was a boat carrying drugs in the Caribbean.

Vance Says โ€˜No Immediate Plansโ€™ to Deploy National Guard to Chicago

VP Vance said admin has โ€œno immediate plansโ€ to deploy National Guard to Chicago, after President Trump remarks indicated such deployment could happen.

Trump to Host Polandโ€™s New President Nawrocki at the White House

President Donald Trump will host Polandโ€™s newly elected president, Karol Nawrocki, at the White House on Sept. 3.
spot_img

Related Articles