- Jim O'Sullivan, High Frequency Economics
The survey indicates that consumers became more concerned about the US economy. Their rating of government economic policy suddenly dropped to the weakest level in almost two years. The recent data shows the growing gap between the most favourable assessments of Current Economic Conditions since July 2005, as well as renewed downward trend of the Expectations Index, which fell by a rather modest 8.6% from the January 2015 peak. Also, the University of Michigan's preliminary consumer sentiment index managed to advance, and was higher than expectation for the current month, but still went down compared to the preceding month's level. The index was 94.3, outperforming the estimates for 94, but still down from 94.7 mark. Moreover, consumers hint that they might increase their savings and delay spending if the pace of job creation does not accelerates. Also, they supposes that inflation will have a minimal impact on their real incomes since long-run inflation expectations plunged 0.2 percentage points to 2.3%, to its record low.
In the meantime, consumers do not think the economy is as strong as it was last year period as well as do not anticipate the economy will show the same financial health in the year ahead as they anticipated a year ago.
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