The University of Michigan index fell sharply, to 62 points against 67 in February, a decline of 7.5% over one month, while analysts expected a less severe drop, to 63.4 points.
The clouds gathering over the American economy are starting to worry consumers again, with the index measuring their confidence falling in March, to levels still historically low, according to the estimate published Friday by the University of Michigan.
The index fell sharply in March, to 62 points against 67 in February, a decline of 7.5% over one month, while analysts expected a less severe drop, to 63.4 points, according to the published consensus. by briefing.com.
Confidence has even sagged a little further compared to the intermediate estimate, published on March 17, which did not take into account the consequences of the fall of Silicon Valley Bank (SVB) and the difficulties of several regional banks.
“The tremors in the banking sector had a limited impact on confidence, which was already in decline”, however estimated Joana Hsu, director of the survey quoted in the press release, “our data shows that consumers are increasingly anticipating a recession”.
The decline concerns both current conditions and expectations. In the latter case, the index even fell below the 60-point mark, to stand at 59.2 points, down 8.5% over one month.
“The decline affects all of our demographic groups but is more pronounced among the youngest consumers, as well as the less educated and those with the lowest incomes,” added Ms Hsu.
Despite everything, the latter are now counting on lower inflation this year than what they envisaged in February, at 3.6% against 4.1%, the lowest level observed since April 2021. But it is still higher expectations in this area observed before the pandemic, which were established in a range between 2.3% and 3%.
Although declining, inflation remained high in February, at 6% according to the CPI index, which is the benchmark.
The Federal Reserve (Fed), however, favors another measure of inflation, the PCE index, which it wants to bring back to around 2% but which also remains at a high level, although oriented downwards, now at 5% over one year in February.
The Fed has continued to raise its rates, now between 4.75% and 5%, despite the recent difficulties encountered by the banking sector, which seems for the moment to be absorbing the shock caused by the bankruptcy of SVB and two other banks. regional companies, Signature Bank and Silvergate, and to ensure the rescue of a fourth, First Republic.
