With inflation easing and gasoline prices falling, the US consumer confidence index rebounded more-than-expected in December, hitting a new high since April this year. in the next six months.
The latest data released by the Conference Board on Wednesday (22) showed the US consumer confidence index rose to 108.3 in December, much higher than the expected 101 and the previous revised value of 101.4. similar for December.
Amid long-awaited market inflation expectations, consumer inflation expectations for the next 12 months fell to 6.7% from 7.1% in November, the lowest level since September 2021. The index growth rate consumer price (CPI) slowed in November recently. Furthermore, the decline in short-term inflation expectations also means that while inflation is still at uncomfortably high levels, it peaked a few months ago.
Among other indicators, the current situation index of consumer assessments of current business and labor market conditions rose to 147.2 from 138.3 the previous month; the index of expectations on the short-term prospects of income, corporate and labor market conditions rose to 82.4 from 76.7. The US Economic Council said the Expectation Index remained around 80, which correlates with the recession.
Thus, the willingness of consumers to buy expensive goods will decrease over the next six months, but the percentage of consumers planning to buy cars has not changed much, while the willingness to buy appliances has hit a new low since July. it is also the result of increased borrowing costs and is bought with a loan. The US Federal Reserve (Fed) raised its key interest rate this year to a range of 4.25% to 4.50%, a record high since late 2007.
Wells Fargo senior economist Sam Bullard said consumers may be more confident than they were in the summer months, although they are still more cautious than they were in 2021. The outlook for consumer confidence next year they will depend on whether the Fed can get a soft landing on the economy’s so-called narrow runway.
Lynn Franco, director of the Center for Economic Indicators at the US Economic Review Council, said inflation expectations for next year fell to their lowest levels since September 2021, boosted by the recent drop in gasoline prices.
