US consumer confidence fell for the fourth consecutive month in November and household inflation expectations rose againwith its medium-term forecast of price pressures Soaring to the highest level in more than a dozen years, showed a survey this Friday.
The preliminary reading of the University of Michigan Consumer Confidence Index fell to 60.4, the lowest since May, from October’s final reading of 63.8. The average expectation of economists consulted by Reuters was that the index would remain at 63.7, without major changes.
The survey’s preliminary index of current conditions fell to 65.7 from last month’s final level of 70.6, while the expectations index fell to 56.9 from 59.3 in October. Like the overall index, both subindices were the lowest since May.
Consumers’ inflation outlook for next year rose for the second straight month to a seven-month high of 4.4%. Over a five-year horizon, consumers expect average inflation of 3.2%, up from 3% in October and the highest since March 2011.
The Federal Reserve authorities, who have raised interest rates by 5.25 percentage points since March 2022 to reduce inflation from four-decade highs, They closely monitor consumer attitudes regarding price developments.
They are interested in inflation expectations trending downward so as not to alter a consumption behavior that could reverse the progress they have made in slowing down the pace of price increases.
Thanks largely to persistent inflation, households have maintained a generally negative view of the U.S. economy and their own prospects since the pandemic hit in early 2020, even as overall employment has returned to record highs. Wages have increased faster than before the health crisis and overall economic growth has been above trend.
Source: Ambito
