Survey of Consumers: Consumer Sentiment Falls in August

The Survey of Consumers, a closely-watched gauge of consumer sentiment from the University of Michigan, clocked in at 89.8 in August, down from the preliminary reading of 90.4. Economists anticipated a reading of 90.6 for the month.

Surveys of Consumers chief economist, Richard Curtin:

Confidence eased back in late August to register a trivial decline from the July reading. Less favorable personal financial prospects were largely offset by a slight improvement in the outlook for the overall economy. Most of the weakness in personal finances was among younger households who cited higher expenses than anticipated as well as slightly smaller expected income gains. Importantly, long term inflation expectations fell to the lowest level ever recorded, with near term inflation expectations anchored to that same low level. Just as low inflation has provided strong support for real income gains, low interest rates have increasingly become the sole driver of large discretionary expenditures. Although consumers increasingly expect a Clinton victory, consumers remained nearly equally split on which candidate would actually improve overall economic conditions or their own personal finances. Overall, the data remains consistent with real personal consumption improving by 2.6% through mid 2017, with large purchases sensitive to future interest rate trends.