Consumer sentiment fell in November

Consumer sentiment fell 3.4 points in November to 60.4, marking the fourth straight monthly decrease, but is still 3.7 points higher than a year ago. The Current Economic Conditions Index decreased 4.9 points from the previous month to 65.7, but remains 7.0 points above the November 2022 index. The Consumer Expectations Index decreased 2.4 points to 56.9 from the last month and is 1.4 points higher than a year ago.

“Consumer sentiment slipped for the fourth straight month, falling 5% in November. While current and expected personal finances both improved modestly this month, the long-run economic outlook slid 12%, in part due to growing concerns about the negative effects of high interest rates. Ongoing wars in Gaza and Ukraine weighed on many consumers as well. Overall, lower-income consumers and younger consumers exhibited the strongest declines in sentiment. In contrast, sentiment of the top tercile of stock holders improved 10%, reflecting the recent strengthening in equity markets.”

“Year-ahead inflation expectations inched up to 4.4%, indicating that the large increase between September’s 3.2% reading and October’s 4.2% reading was no fluke. The current reading is the highest since November 2022 and remains well above the 2.3-3.0% range seen in the two years prior to the pandemic. Long-run inflation expectations also rose, from 3.0% last month to 3.2% this month, the highest reading since 2011. Gas price expectations, both over the short and long run, rose to their highest readings this year,” said University of Michigan Surveys of Consumers Director Joanne Hsu.

Read the University of Michigan Surveys of Consumers release.