With all of the political vindictiveness apparent on the modern government of the United States, the US Consumer sentiments still managed to improve in May counting the sole number of consumers as stated on the consumer sentiment index of University of Michigan.
As stated by most reports, the index declared a number of 97.7 in May statements, which is deemed higher than the expected number of various economists. Also, the number recovered from April’s data, noting a 0.7 percent month over month advancement and a 3.2 percent uptrend from Last year’s May.
Survey of Consumers chief economist, Richard Curtin, stated on reports that there is still a massive dissimilarity amongst the Republicans and the Democrats about the consumer sentiment but that it lessened diminutively from 65 to 55 consequently.
Curtin also told reports the reason behind such is the “Democrats expressing diminished fears of an immediate recession and lessened concerns about personal financial setbacks.”
Also, Curtin added in the recent survey said that the sole purpose behind the sentiment upturn is due to the fact that consumers are setting their expectations so high in terms of their incomes, as income did arise while inflation maintained its rates low.
However, Curtin’s statement doesn’t mean that consumers are spending more. Automobile sales conditions just reached a three-year low, while home buying conditions were also marked low. Home-selling sentiment hit a positive note in its recent data, as seen on the reports.
From the time when the U.S. election was still prevalent up to the present times, the parties of Republicans and Democrats have been at odds about President Trump’s potential impact on the economy.
More so, there were worries of a very likely decline in the U.S. and a down crash of the stock market under Trump’s presidency. Nonetheless, that hasn’t occurred. Unemployment is expected to hike but so far it hasn’t, the stock market has upturned and was said to have caused by Trump and it sure did affect the consumer numbers as well.
More on Numbers
As aforementioned, the numbers of Consumer Sentiment in the United States has indeed improved as indicated on University of Michigan’s consumer sentiment index. The index added 0.7 percent from April’s 97.0 and was considered much higher than last year’s May of 94.6. The announced data beat analyst expectations of 97.0.
The present-day economic conditions index delivered a number of 112.7, unmoved from the preceding month and onward of May 2016's evaluation of 109.9.
For the time being, the index of consumer expectations augmented to 88.1 in May from 87.0 in April and 84.9 in May of last year.
According to Curtin, “Consumer sentiment remained on the high plateau established following Trump's election, with the early May figure nearly identical with the December to May average of 97.4. The Trump bump was relatively small given that the sentiment index averaged 91.8 in the comparable six month period a year ago and 94.5 in the same period two years ago.”
"The recent stability in consumer sentiment, however, masks two important underlying shifts in the components as well as in the partisan divide. More favorable income gains and low inflation meant that consumers held the most favorable real income expectations in a dozen years. Buying plans, however, were mixed: household durables rose to a decade peak, while vehicle buying conditions slipped to a three year low." He added.
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