The University of Michigan Final Consumer Sentiment for November came in at 97.5, down 1.1 from the October Final reading. Investing.com had forecast 98.4.
Surveys of Consumers chief economist, Richard Curtin, makes the following comments:
Consumer sentiment has remained largely unchanged at very favorable levels during 2018, with the November reading nearly at the center of the eleven month range from 95.7 to 101.4. Although the data recorded a decline of 2.8 Index points following the election, the drop was related more to income than political party: among those with incomes in the bottom third, the Sentiment Index rose by 10.4 points and fell by 6.6 points among those in the top third of the income distribution. In contrast, the Sentiment Index remained unchanged among Democrats and Republicans prior to and following the election. [More…]
See the chart below for a long-term perspective on this widely watched indicator. Recessions and real GDP are included to help us evaluate the correlation between the Michigan Consumer Sentiment Index and the broader economy.
To put today’s report into the larger historical context since its beginning in 1978, consumer sentiment is 13.3 percent above the average reading (arithmetic mean) and 14.6 percent above the geometric mean. The current index level is at the 86th percentile of the 491 monthly data points in this series.
Note that this indicator is somewhat volatile, with a 3.0 point absolute average monthly change. The latest data point saw a 1.1 percent change from the previous month. For a visual sense of the volatility, here is a chart with the monthly data and a three-month moving average.
For the sake of comparison, here is a chart of the Conference Board’s Consumer Confidence Index (monthly update here). The Conference Board Index is the more volatile of the two, but the broad pattern and general trends have been remarkably similar to the Michigan Index.
