University of Michigan’s consumer sentiment index stays strong in November

The University of Michigan’s Consumer confidence index rose in the month of November. The final reading rose 0.7 percentage points to 98.5 from its prior month’s reading, but still ended the month below October’s decade high of 100.7.

The University of Michigan’s Index of Consumer Sentiment dropped 2.2 points in November, but its decade high hit one month earlier. The current conditions series rose 5.8 percent year-on-year, while expectations rose 4.3 percent.

Consumers are usually more positive about job and income prospects, which put them in a more joyous mood to celebrate the holidays and spend a slightly more freely than in prior years, noted Wells Fargo in a research report.

Future economic conditions expectations have been stimulated by consumers’ improving assessment of consumer finances. 64% of consumers reported that their finances are better than they were five years ago and 54 percent expect their finances to rebound further in the next five years. Inflation expectations continue to be muted, with inflation expected to average just 2.4 percent in the next five to ten years, stated Wells Fargo.

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