- Inflation and consumer sentiment driving Federal Reserve policy
- University of Michigan tracks consumer sentiment while the FED survey tracks American debt and wealth.
University of Michigan Links Iran War Outbreak to Historic Low Consumer Sentiment
What happened
The University of Michigan reported that consumer sentiment is near its lowest level in 74 years, with the index registering 48.0 in October. The survey found that the index hit a historic low of 44.8 in May, shortly after the outbreak of the Iran war. Shopper attitudes in October were low due to inflation squeezing household budgets and a global fuel supply shortage keeping gasoline prices high.
From ktbb.com
Why it matters
The report links the historic drop in consumer sentiment to the Iran war outbreak and rising costs, as global oil prices crossed $116 a barrel. Shoppers surveyed expect inflation to rise further over the next year, while the average price of a gallon of gas in the U.S. jumped roughly 43% since the war began.
The University of Michigan tracks consumer sentiment while the FED survey tracks American debt and wealth, and this long-run survey is used to inform expectations regarding policy.
From ktbb.com
Who's involved
- University of MichiganConducted the monthly consumer sentiment survey
- Joanne HsuDirector of Consumer Surveys at the University of Michigan
- Middle EastGeopolitical region whose war outbreak preceded the sentiment decline
Who could feel it
Possible knock-on effectsThese are possibilities Brind reasoned out, not predictions, and not advice. Most are not stated in any report.
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The entities involved
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University of Michigan
public research university in Ann Arbor, Michigan