Consumer Sentiment was 71.7 in October according to the University of Michigan Consumer Sentiment Index. October’s figure was 1.5 points lower than the September reading and is 12.3 points below the October 2020 index. The Current Economic Conditions Index fell 3.0 points from the previous month to 77.7 and is 9.5 points below the October 2020 index. The Consumer Expectations Index decreased 0.3 points to 67.9 and is 14.3 points lower from a year ago.
“The patterns of consumers’ reactions to recent rises in inflation represent the preconditions that can promote an escalating inflation rate during the year ahead. Consumers’ recognition of high and rising prices is near universal, so too is their desire to reestablish spending for a more traditional holiday season. People understand that the origin of inflation has been in the upheavals in supply lines and labor markets. The acceptance of higher prices was caused by swollen savings due to the record pandemic cash incentives as well as by Biden’s new social support programs. The declining resistance to price hikes among buyers will be joined by less resistance among sellers to hiking prices that will be justified by higher materials and labor costs.” said Richard Curtin, chief economist of UM Surveys of Consumers.
Read the University of Michigan Surveys of Consumers release.