Consumer Sentiment was 61.7 in February, according to the University of Michigan Consumer Sentiment Index. February’s figure was 5.5 points lower than the January reading and is 15.1 points below the February 2021 index. The Current Economic Conditions Index fell 1.5 points from the previous month to 68.5 and is 17.7 points below the February 2021 index. The Consumer Expectations Index decreased 6.7 points to 57.4, and is 13.3 points lower from a year ago.
“Sentiment continued its downward descent, reaching its worst level in a decade, falling a stunning 8.2% from last month and 19.7% from last February. The recent declines have been driven by weakening personal financial prospects, largely due to rising inflation, less confidence in the government’s economic policies, and the least favorable long term economic outlook in a decade. Importantly, the entire February decline was among households with incomes of $100,000 or more; their Sentiment Index fell by 16.1% from last month, and 27.5% from last year. The impact of higher inflation on personal finances was spontaneously cited by one-third of all consumers, with nearly half of all consumers expecting declines in their inflation adjusted incomes during the year ahead. In addition, fewer households cited rising net household wealth since the pandemic low in May 2020, largely due to the falling likelihood of stock price increases in 2022.” said Richard Curtin, chief economist of UM Surveys of Consumers.
Read the University of Michigan Surveys of Consumers release.