Consumer sentiment has surged 10% early this month to a preliminary reading of 54.4, the highest point since February, according to the University of Michigan’s latest survey of Americans. The rise in sentiment was driven by easing price pressures at the pump in recent weeks.
Impact of Gas Prices on Consumer Sentiment
The survey’s director, Joanne Hsu, noted that sentiment has already mostly recovered from the record low reached in May, as the war with Iran sent energy prices skyrocketing. However, sentiment remains below pre-war levels, and consumer sentiment is closely tied with gas prices.
Retail spending in June grew just 0.2%, according to Commerce Department data, though when excluding higher gas prices, spending was up by a solid 0.7% that month. The state of the labor market, with unemployment at a low 4.2% and new applications for unemployment assistance still at historically low levels, will continue to support consumer spending.
Original reporting: KEYT (Ventura/Santa Barbara) — read the source article.
