Consumer sentiment hits three-month high

2:00 PM consumer, sentiment, threemonth No Comments

Consumer sentiment climbed to a three-month high in August as households made progress paying down debt, but future expectations remained grim, a survey on Friday showed.

The Thomson Reuters/University of Michigan's final reading on overall consumer sentiment this month rose to 74.3, its highest since May and above economists' expectations of 73.6. In July, the number stood at 72.3.

Buying was bolstered by price discounts and low interest rates, the survey found. But the biggest source of optimism was tied to success in trimming debt.

"Rather than citing income changes, consumers were more likely to cite favorable shifts in the amount of their outstanding debt and the value of their assets," survey director Richard Curtin said in a statement.

The survey's barometer of current economic conditions rose to 88.7 from 82.7, the highest since January of 2008.

However, the survey's gauge of consumer expectations fell to 65.1 from 65.6, the lowest level since December of 2011.

Half of those surveyed said their financial situation was worse than it was five years ago and the majority anticipated no wage gains during the year ahead, the survey showed.

The one-year inflation expectation rose to 3.6 percent from 3 percent in July, while the survey's five-to-10-year inflation outlook was at 3 percent, compared with 2.7 percent last month.

Reuters contributed to this report.

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Consumer sentiment hits three-month high

9:00 AM consumer, sentiment, threemonth No Comments

CNBC Rick Santelli has an effort the latest consumer sentiment. The number is 73.6, better than last month and slightly above expectations.

Two economic reports released Friday draw a somewhat rosier picture of the economy.

Consumer sentiment improved in early August rose spurred to its highest level in three months as sales at retailers and low mortgage rates Americans to increase their purchase plans, a survey showed on Friday.

But worry about rising food prices caused a jump in both short and term inflation expectations the Thomson Reuters/University of Michigan consumer survey showed sentiment.

In a separate report, improved gauge of future economic activity in July on a drop in new claims for unemployment benefits and an increase in the permits, housing, although the reading still sluggish growth ahead pointed out.

The Conference Board, said on Friday that its leading economic index climbed 0.4 per cent to 95,8, reversing a decline of 0.4 percent in June. By Reuters respondents analysts had predicted the index would rise 0.2 percent in July.

Fewer jobless claims last month the biggest driver in the growth of the index, said the Conference Board was. In addition, building permits during the months that could point to more construction on the road jumped.

The first reading on the index of consumer sentiment rose to its highest level since May to 73.6 from 72,3 last month, topping forecasts of by economists for a slight uptick to 72,4.

Atmosphere "Even though the rate of growth in personal consumption, expenditure can be expected from the second quarter lull, growth rebound can be expected to just under two percent 2013 remain to the end of the first quarter," said survey Director Richard Curtin in a statement.

The survey barometer of current economic conditions rose to 87,6 of 82,7, but the survey gauge of consumer expectations fell to 64.5 from 65,6. expectations were at their lowest level since December.

Pick the view that economic growth will be in the second half of the year has strong retail sales in July but lackluster remain increased. Growth and the setting were disappointing in the spring, raising expectations that the Federal could develop reserve more stimulus packages.

The Conference Board leading economic references "slow growth by the end of 2012" according to Ken Goldstein, an economist at the organization index.

"But sales are better than expected, suggest that the consumer starts to school again," he added.

Reuters contributed to this report.

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Consumer sentiment drops to 6-month low

11:00 AM 6month, consumer, drops, sentiment No Comments

U.S. consumer sentiment fell in early June to a six-month low on worries about deterioration in the jobs market and Europe's festering debt crisis, a survey released on Friday showed.

Americans downgraded their economic outlook after their confidence improved in May to its highest level since October 2007.

"It's more convincing evidence that the economy is stuck in low gear. We've had a steady stream of negative data that increases pressure on the Fed to do more," said Joe Manimbo, Travelex market analyst.

The Thomson Reuters/University of Michigan's preliminary reading on the overall index on consumer sentiment fell to 74.1 in June from to 79.3 in May, falling short of the 77.5 reading predicted by economists recently polled by Reuters.

This was the weakest reading since 69.9 in December.

"Income losses were reported by nearly one-third of all households in early June and the news reaching consumers about job prospects turned negative for the first time since late 2011," survey director Richard Curtin said in a statement.

"In addition, a small but rising number of consumers reported their concerns about the fallout from Europe, the most that mentioned the potential domestic impact from an international crisis since the Asian flu in 1998," he said.

Consumer sentiment is seen as a predictor of consumer spending, which accounts for roughly two-thirds of the U.S. economy.

There has been data pointing to a pullback in spending. On Wednesday, the government reported retail sales fell for a second straight month after steady growth in the first quarter.

Renewed concerns about jobs and problems in Europe undermined consumers' current and future outlook on the economy.

The survey's barometer of current economic conditions fell to 82.1 in early June, the lowest level in six months and below the 85.3 figure predicted by analysts. It stood at 87.2 at the end of May, which was the highest since January 2008.

The survey's gauge of consumer expectations declined to 68.9 in early June, the lowest since December and falling short of a median forecast of 71.8. It was 74.3 at the end of May, which was the highest since July 2007.

This less optimistic outlook in early June coupled with a drop in the likelihood that families will buy cars, refrigerators and other big-ticket items, the survey showed.

Its index on buying conditions for durables fell to 125, matching the level seen in March, from 132 in May.

The survey's one-year inflation expectation among consumers was unchanged at 3.0 percent, but its five-to-10-year inflation outlook rebounded to 2.9 percent in early June after falling to 2.7 percent in May.

Copyright 2011 Thomson Reuters.

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