Economy Watch: U.S. Consumers Stay Upbeat
- Oct 03, 2016
Consumers might be a little rattled by the uncertainty of this year’s election, but apparently not enough to affect the latest University of Michigan Final Consumer Sentiment index. September’s score came in at 91.2, up slightly from the preliminary reading earlier in the month, the university reported on Friday. Consumers feeling good about the economy, and their own prospects, are important ingredients in keeping consumer spending healthy, which is of considerable concern to retailers as the year ends.
According to Surveys of Consumers chief economist Richard Curtin, confidence inched upward in September due to gains among higher income households. On the other hand, the Sentiment Index among households with incomes under $75,000 has remained the same level for the third month in a row. “Importantly, the data provide no evidence of an upward trend as the average level of the Sentiment Index, since the start of 2016 is nearly identical with the September level (91.4 versus 91.2),” he said.
Another metric that retailers watch closely: personal income and expenditures, which are tracked by the the Bureau of Economic Analysis. According to that agency on Friday, personal income increased $39.3 billion (0.2 percent) in August. Personal consumption expenditures (PCE) increased $6.2 billion (less than 0.1 percent) during the month.
That’s a middling performance for income and spending, and even more so considering that real PCE — which is adjusted for price increases — decreased 0.1 percent. The PCE price index increased 0.1 percent. Excluding food and energy, the PCE price index increased 0.2 percent during August.