Surveys of Consumers reported on Friday that a preliminary readings show consumer confidence bounced back in May to its strongest level in nearly a year.
The University of Michigan preliminary consumer sentiment index for May, released Friday, registered at 95.8, compared with a final April reading of 89.0. May’s preliminary reading was the strongest since June 2015 and it followed the lowest reading reported since September 2015 in April.
Economists surveyed by The Wall Street Journal had expected the preliminary May index would hold steady at 89.0.
“Consumer sentiment rebounded in early May due to more frequent income gains, an improved jobs outlook and the expectation of lower inflation and interest rates,” said Richard Curtin, the survey’s chief economist. “The largest gains were recorded among lower income and younger households, although the gains were recorded among all income and age subgroups as well as across all regions.”
|Index of Consumer Sentiment||95.8||89.0||90.7||+7.6%||+5.6%|
|Current Economic Conditions||108.6||106.7||100.8||+1.8%||+7.7%|
|Index of Consumer Expectations||87.5||77.6||84.2||+12.8%||+3.9%|
Nearly all of the gains in consumer confidence this month came from the Expectations Index, which rose to its highest level in nearly a year.
“To be sure, the data still indicated the negative impact of uncertainty about future economic policies associated with the Presidential election, but its overall impact was overwhelmed by favorable economic developments,” Mr. Curtain added. “It is too early to judge the potential impact of the election on consumers’ expectations, and one month’s rebound in consumer confidence is insufficient to increase the current forecast for inflation-adjusted consumer expenditures from 2.5% during 2016.”