Consumer sentiment decreased 2.6 points month-over-month in November to 51, down 20.8 points from one year ago, according to final results of the University of Michigan Surveys of Consumers. The Current Economic Conditions Index decreased 7.2 points from the previous month to 51.1 and down 12.8 points from the previous year. The Consumer Expectations Index decreased by 0.7 points to 51, 25.9 points lower than the November 2024 Index.
Consumer sentiment was little changed this month with a 2.6 index point decrease from October that is within the margin of error. After the federal shutdown ended, sentiment lifted slightly from its mid-month reading. However, consumers remain frustrated about the persistence of high prices and weakening incomes. This month, current personal finances and buying conditions for durables both plunged more than 10%, whereas expectations for the future improved modestly. By the end of the month, sentiment for consumers with the largest stock holdings lost the gains seen at the preliminary reading. This group’s sentiment dropped about 2 index points from October, likely a consequence of the stock market declines seen over the past two weeks.
Year-ahead inflation expectations inched down from 4.6% last month to 4.5% this month. This marks three consecutive months of declines, but short-run inflation expectations still remain above the 3.3% seen in January. Long-run inflation expectations softened from 3.9% last month to 3.4% in November. These expectations are now modestly above the 3.2% January 2025 reading. Despite these improvements in the future trajectory of inflation, consumers continue to report that their personal finances now are weighed down by the present state of high prices.
Read the University of Michigan Surveys of Consumers release.
