Michigan Consumer Sentiment: Mostly Unchanged for July Final
The July Final Report came in at 51.5, up 1.5 (3.0%) from the June Final. Investing.com had forecast 51.1. Since its beginning in 1978, consumer sentiment is 39.9 percent below the average reading (arithmetic mean) and 39.1 percent below the geometric mean.
Surveys of Consumers chief economist, Richard Curtin, makes the following comments:
The final July reading showed little change in consumer sentiment from its historic low in June. The one-year economic outlook fell to its lowest reading since 2009. At the same time, concerns over global factors have eased somewhat. This easing provided some limited support to buying conditions for durables, which remained near the all-time low reached last month, as well as a modest retreat in long run inflation expectations. However, inflation continued to dominate consumers’ attention, and labor market expectations continued to soften. This month’s Sentiment Index was the second lowest reading on record, and the Q2 slowdown in personal consumption expenditures was no surprise. The final July reading of the median expected year-ahead inflation rate was 5.2%, little changed from mid-month or the preceding two months. Long run expectations came in at 2.9%, remaining within the 2.9-3.1% range seen in the past 11 months. [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.