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Consumer Sentiment: Modest Declines As Expected, Still Strong

September 29, 2017

Bottom Line: The September consumer sentiment index was revised just a touch lower as current conditions component pulled back and expectations rose modestly. 1-year inflation expectations rose and touched their highest levels of the last year. Still, at 2.7%, the level of inflation expected is low relative to history and is still trending down. 5-year inflation expectations continued to moderate. Overall, consumer sentiment remains elevated since the sharp acceleration seen after the elections but the pace of gains has moderated.

Consumer Sentiment was REVISED DOWN by 0.2 points in late September to 95.1%, compared with market expectations for no change to 95.3%.

Sentiment was little changed over the past 3 months. Despite this month's slight decline, compared to August's final level of 96.8%, sentiment is 4.3% ABOVE its year ago level.

Current Conditions were REVISED DOWN by 2.2 points to 111.7%. Current conditions are now 7.2% ABOVE their year ago level. Consumer Expectations were REVISED UP by 1.0 points to 84.4%. Despite this month's modest decline, compared to August's final level of 87.7%, expectations are 2.1% ABOVE their year ago level.

Article by Contingent Macro Advisors