U.S. consumer sentiment increased to a five-month high in July, according to the University of Michigan’s Surveys of Consumers. The Consumer Sentiment Index rose to 54.4 this month, the highest reading since February, from a final reading of 49.5 in June.

Economic Impact

The improvement in consumer sentiment may be temporary, as renewed conflict in the Middle East raises gasoline prices. The survey was conducted from June 23 to July 13, with more than 70% of interviews completed before the collapse of the ceasefire between the U.S. and Iran last week, which pushed oil prices to a one-month high.

“This month’s rise in sentiment was pervasive across the population, seen across groups by age, income, wealth, and political party,” said Joanne Hsu, the director of the Surveys of Consumers. “However, with prices remaining frustratingly high, consumers are hardly ebullient about the economy; sentiment is down 12% from a year ago. Thus, sentiment’s upward momentum may prove difficult to sustain if recent declines in gas prices continue to reverse course.”

Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.