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The
University of Michigan's monthly consumer sentiment index survey
showed households' one-year inflation expectation at 2.8%, down
from 2.9% in July and now the lowest since December 2020. The
five-year outlook for price growth was unchanged at 3.0%.
The wider survey showed a modest improvement in consumer
sentiment this month, with the uptick having significant
political overtones as the Nov. 5 U.S. presidential election
approaches.
The overall sentiment index edged up to 67.9 in August from
July's eight-month low of 66.4, snapping a four-month slide. The
increase largely came from self-described political
independents, Joanne Hsu, the director of the University of
Michigan's Surveys of Consumers, said in a statement.
"Sentiment this month reflects a slight rise in sentiment among
independents, as Democrats and Republicans offset each other
almost perfectly," Hsu said. "Democrats exhibited a large 10%
increase in sentiment while Republicans posted an equally sized
decline."
Hsu said the patterns reflect "a sea change" in election
expectations this month, with Vice President Kamala Harris
taking over as the Democratic presidential candidate after
President Joe Biden bowed out of the race.
In July, University of Michigan data showed 51% of consumers
expected Republican nominee Donald Trump to win the election,
versus 37% for Biden, Hsu said. That has since flipped and now
36% of consumers expect Trump to win compared with 54% for
Harris.
(Reporting by Dan Burns; Editing by Paul Simao)
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