Jharonne Martis, consumer research director at LSEG, analyses consumer wellbeing and explains the context behind the shift in spending on ‘making money’.
US Consumer Confidence An optimistic outlook for the labor market led the PMI to rise in May after falling over the past three months, but Americans still expect inflation and high interest rates to continue.
The Conference Board’s consumer confidence index rose to 102 in May from 97.5 in April. Economists surveyed by The Wall Street Journal had expected the index to fall again to 96, but the reading outperformed the University of Michigan index. Consumer sentiment index.
“Confidence improved in May after three consecutive months of declines,” Dana Peterson, chief economist at the Conference Board, said in a statement. “The overall confidence index remained within the relatively narrow range it has been in for more than two years,” he added.
“Compared to last month, consumer confidence improved across all age groups. In terms of income, confidence increased the most among those earning $100,000 or more. Looking at a six-month rolling average, confidence remains strongest among the youngest (under 35) and wealthiest (earning over $100,000) consumers,” Peterson wrote.
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Consumer confidence rose slightly in May after three consecutive months of declines, according to the Conference Board’s latest report. (David Paul Morris/Bloomberg/File/Getty Images)
According to the report, consumers cite price in particular as a reason. Food and Grocery The biggest influence on views of the U.S. economy is the forecast for the average rate of inflation over the next 12 months, which rose to 5.4% from 5.3%.
Peterson is probably an American Inflation expectationsThe percentage of consumers who expect interest rates to rise over the next year also increased from 55.2% to 56.2%.
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According to the report, food and grocery prices were a key indicator of the health of the economy for consumers. (Frederick J. Brown/AFP via Getty Images/File)
Consumers’ assessment of current business conditions declined slightly in May, with the percentage of respondents stating that their situation was “good” falling to 20.3% from 20.8% in April, while the percentage of respondents who said their situation was “poor” remained unchanged from the previous month at 17.6%.
Consumer reviews have also improved. Labor marketwhich helped to increase the overall feeling of trust.
About 80% of Americans consider fast food a “luxury item” because of its high price.
Consumers’ views on the labor market improved in May, according to a report from the Conference Board. (Steve Forst/Newsday RM via Getty Images/File)
“Views of current labor market conditions improved in May, with fewer respondents saying jobs are hard to find outpacing a slight decline in those saying jobs are plentiful,” Peterson added. Only 13.5% of consumers said it’s hard to find a job, down from 15.5%, while the number of people who say jobs are plentiful fell to 37% from 38.4% last month.
The report also showed that consumers’ short-term outlook for income, business and labor market conditions rose to 74.6 from 68.8 in the previous month.
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But despite that improvement, the index has remained below 80 for four consecutive months, prompting the Conference Board to say that “normally Signs of recession Ahead.”
Reuters contributed to this report.
