The University of Michigan's consumer sentiment for the US was revised higher to 98.4 in March 2019 from a preliminary 97.8, as the current economic conditions sub-index came in stronger than initially thought. The latest reading was slightly above the average of 97.2 recorded in the past 26 months.
The gauge for current economic conditions came in at 113.3, above the flash estimate of 111.2 and the previous month's final figure of 108.5. Also, the consumer expectations sub-index stood at 88.8, slightly below the preliminary reading of 89.2 and compared to February's 84.4. Inflation expectations for the year ahead edged down to 2.5 percent in March (vs preliminary 2.4 percent) from February's 2.6 percent; and the 5-year outlook rose to 2.5 percent, unrevised from early estimates and against February's 2.3 percent.
"Consumer confidence rebounded in March to 98.4 from last month's 93.8, slightly above the average of 97.2 recorded in the past 26 months. The March gain in the Sentiment Index was entirely due to households with incomes in the bottom two-thirds of the income distribution, posting a gain of +7.1 Index-points, while households with incomes in the top third fell by 1.1 Index-points. Middle and lower income households more frequently reported income gains than last month, although income gains were still widespread among upper income households. Indeed, the last time a larger proportion of households reported income gains was in 1966. Rising incomes were accompanied by lower expected year-ahead inflation rates, resulting in more favorable real income expectations (see the chart). Moreover, all income groups voiced more favorable growth prospects for the overall economy. While no further decline in interest rate expectations was recorded in March, the data suggest that consumers anticipated additional increases in 2019. Finally, it should be noted that too few interviews were conducted following the summary release of the Mueller report to have any impact on the March data; if there is any, it may affect the April data. Overall, the data do not indicate an emerging recession but point toward slightly lower unit sales of vehicles and homes during the year ahead.", Surveys of Consumers chief economist, Richard Curtin, said.
University of Michigan | Joana Ferreira | joana.ferreira@tradingeconomics.com
3/29/2019 2:11:16 PM