The University of Michigan Preliminary Consumer Sentiment for May came in at 98.8, unchanged from the April Final reading. had forecast 98.5.

Surveys of Consumers chief economist, Richard Curtin, makes the following comments:

Consumer sentiment remained unchanged in early May from the April survey. The Expectations Index gained 1.1 points and the Current Conditions Index fell 1.6 points--both were statistically insignificant changes. What is likely to capture attention, however, are the small uptick in near term inflation expectations, the downward slippage in income expectations, and the expected stabilization of the national unemployment rate at decade lows. The data will thus provide some additional points for both sides in the debate about the timing and number of future interest rate hikes. Eight-in-ten consumers anticipated interest rate hikes during the year ahead, and fewer consumers anticipated further declines in the unemployment rate--although all of the shift was toward the expectation of a stable unemployment rate rather than an increased rate. Consumers have a remarkable track record for anticipating changes in the actual unemployment rate, as shown in the accompanying chart. Overall, the data are consistent with a growth rate of 2.7% in real personal consumption from the second half of 2018 to first half of 2019. [More...]

See the chart below for a long-term perspective on this widely watched indicator. Recessions and real GDP are included to help us evaluate the correlation between the Michigan Consumer Sentiment Index and the broader economy.

Michigan Consumer Sentiment

To put today's report into the larger historical context since its beginning in 1978, consumer sentiment is 15.0 percent above the average reading (arithmetic mean) and 16.4 percent above the geometric mean. The current index level is at the 88th percentile of the 485 monthly data points in this series.