U.S. consumer sentiment rose in early December, snapping a five-month streak of declines as inflation expectations cooled. The University of Michigan’s preliminary Index of Consumer Sentiment for December came in at 53.3, up from 51.0 in November and ahead of the consensus estimate of 52.0.
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“Overall, while views of current conditions were little changed, expectations improved, led by a 13% rise in expected personal finances, with improvements visible across age, income, education, and political affiliation,” said Surveys of Consumers Director Joanne Hsu.
Inflation Expectations Fall to Lowest Level Since January
Furthermore, the survey showed that inflation expectations have eased. Consumers expect year-ahead inflation of 4.1%, down from 4.5%, and long-run inflation of 3.2%, down from 3.4%.
On Friday, the Bureau of Economic Analysis (BEA) announced that September’s core Personal Consumption Expenditures (PCE) index, which is the Fed’s preferred measure of inflation, increased by 0.2% month-over-month and 2.8% year-over-year, both of which were in line with the consensus estimate. The data was originally scheduled to be published on October 31 but was delayed due to the government shutdown.
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