inflation hits consumer confidence in January

U.S. consumer confidence deteriorated slightly in January, dampened by the spread of the Omicron variant of Covid-19 and inflation concerns, according to the preliminary estimate from the University of Michigan survey released on Friday. . The index measuring this confidence stood at 68.8 points against 70.6 points in December, down 2.5% over the month and almost 13% compared to December 2021.

Analysts on average expected a decline of this order to 68.5 points, according to Briefing.com. “While the Delta and Omicron variants certainly contributed to this decline“of household morale,”this deterioration is also due to the escalation of inflationsaid survey economist Richard Curtin in a statement.

«In early January, three-quarters of consumers considered inflation the most serious problem facing the country, ahead of unemployment“, he underlines. Inflation in the United States is indeed in December at its highest since 1982, with prices which have climbed, compared to last year, by 7% according to the CPI index.

Asked about the state of their finances, 33% of respondents say they are less financially comfortable than a year ago, “the worst rate since 2014,“underlines the survey. Half of households (48%) “expect inflation to eat into any wage increases, leading to a loss of real income».

For Andrew Hunter, economist of Capital Economics, “the fall in the index suggests that concerns about Omicron and high inflation have outweighed the relief provided by a modest and temporary decline in gasoline prices». «Soaring inflation should prove a more long-lasting worry», warns the expert.

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