U.S. consumer confidence sharply climbed in September, marking its first in six months since the pandemic hit the country.
Consumer sentiment in the U.S. improved significantly per the University of Michigan’s latest reading, a sign that Americans are becoming more optimistic towards the country’s economic future.
US consumer sentiment reach 78.9
U.S. consumer sentiment climbed to 78.9 points in September coming from the previous month’s 74.1, as per the University of Michigan’s consumer sentiment index released on Friday, September 18. Consumer sentiment based on a survey of economists polled by Bloomberg hit 75 points only.
The preliminary reading this month is also the highest point recorded since March when the pandemic crippled most of the country’s economic activities. Yet, the figure is still 22 points below February’s measure.
— CNA (@ChannelNewsAsia) September 18, 2020
The gauge for current economic conditions, on the one hand, jumped from 82.9 to 87.5. The Index of Consumer Expectations also reached its highest measure since March, with 73.5 points coming from 68.5.
A positive indicator
In a separate report provided by the Conference Board, the measure of U.S. economic growth slightly increased by 1.2% in August coming from July’s 2.0%.
The country’s consumer sentiment index appears more positive than other economic indicators released this week.
Upcoming presidential elections influenced data
A chief economist of Survey of Consumers at the University of Michigan, however, warned that factors like the result of presidential elections could incur “steep losses” in the country’s consumer confidence.
“Over the next several months, there are two factors that could cause volatile shifts and steep losses in consumer confidence: how the election is decided and the delays in obtaining vaccinations,” Richard Curtin said in a statement.
Curtin also said that the upcoming U.S. presidential election is starting to have an influence on Americans’ expectations for the country’s economic future. September’s gains were mainly driven by positive economic outlooks as well, according to him.
Democrats view, for instance, has improved to 68.4 points coming from 57.6 in August. The Outlook for Republicans, on the one hand, waned from 98.6 to 95.7.
“The September gains were primarily in the outlook for the economy, and it was Democrats that posted gains in economic prospects while optimism about the economy weakened among Republicans,” Curtin said.
The final reading of the survey will be released on October 2.
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