U.S. President Donald J. Trump (C), flanked by Gary Masino (L) of the Sheet Metal Workers Union, Telma Mata (2nd R) of the Heat and Frost Insulators Allied Workers Local 24 and United Brotherhood of Carpenters General President Doug McCarron (R), holds a roundtable meeting at the White House on Jan. 27. 2017. (Photo: Reuters)
The Survey of Consumers, a closely-watched gauge of consumer sentiment, continued to hover at the “high plateau” hit after President Donald Trump’s election. Consumer sentiment came in at a strong 97.0 in April and partisan divisions over outlook lessened.
“Consumer sentiment continued to travel along the high plateau established following Trump’s election, with only minor deviations from its five month average of 97.4,” Richard Curtain, chief economist at the survey said. “There was widespread agreement among consumers on their very positive assessments of the current state of the economy as well as widespread disagreement on future economic prospects.”
The swing independent group are solidly in the optimistic camp, though their strength has yet to translate to higher consumer spending, as revealed in this morning’s GDP report. Consumer confidence readings surged following President Trump’s election and have since platued, but remain very high.
“It is of some interest to note that the Expectations Index among self-identified Independents, who may be less susceptible to traditional political ideologies, rose to a very favorable 91.3 in April, up from March’s 85.8 and well above the pre-election October reading of 73.1,” Mr. Curtain added. “The level of optimism among Independents, who account for 42% of all consumers, points toward continued growth in consumer spending in 2017 at about a 2.5% pace.”
The partisan divide on the Expectations Index was 51.0 points in April (61.4 vs. 112.4), down from last month’s 63.1 (59.4 vs. 122.5). However, Republicans moderated their optimism more than Democrats reduced their pessimism, perhaps no doubt due to uncertainty in the House of Representatives.
Next data release: Friday, May 12, 2017 for Preliminary May data at 10am ET
