Goldman Sachs and University of Michigan Analyze Factors Driving US Consumer Sentiment

Goldman Sachs is collaborating with the University of Michigan on a study into the factors influencing consumer sentiment in the United States. The research indicates that while consumer sentiment is low, spending remains robust, a divergence that has puzzled economists. The findings suggest that non-economic factors are overriding traditional economic indicators.

The study identifies that factors such as media pessimism regarding economic prospects, popularity ratings of incumbent governments, and trust in public institutions are key variables. These non-economic factors are reportedly overriding economic determinants like inflation, job market stability, and household indebtedness.