The following from Bloomberg's commentary on today's stellar consumer confidence report echoes our assessment of present conditions:
U.S. Consumer Sentiment Rises to Six-Month High, Above Estimate
- Sentiment index rose to 100.8 (est. 96.6) from prior month’s 96.2; result is higher than most optimistic estimate in Bloomberg survey
- Current conditions gauge increased to 116.1 from 110.3
- Expectations measure climbed to 91.1, a 14-year high, from 87.1
The optimism reflected recent financial gains, which were cited by 56 percent of households, just below the record of 57 percent reached in March this year and February 1998, the report said.
Consumers’ views of buying conditions for houses, vehicles and household items “grew slightly more optimistic,” according to the report. That’s a good sign for growth in consumer spending, the biggest part of the economy, and in sync with retail sales results for August released on Friday.
While a strong job market is a positive, the U.S. is facing headwinds from trade disputes.
“Concerns about the negative impact of tariffs on the domestic economy were spontaneously mentioned by nearly one-third of all consumers in the past three months, up from one-in-five in the prior four months,” according to the report.
“Personal finances remained very strong due to gains in income and household wealth,” Richard Curtin, director of the University of Michigan consumer survey, said in a statement. However, “the largest problem cited on the economic horizon involved the anticipated negative impact from tariffs.”