National consumer sentiment in August hit its lowest level since January, according to the quarterly University of Michigan survey of consumer sentiment. Most of the decline was in the Current Economic Conditions Index, which fell to its lowest level since November 2016.
Consumers gave a less favorable assessment of buying conditions, mainly because of less favorable perceptions of market prices and, to some extent, rising interest rates. Those surveyed cited future income and job certainty as the main reasons for their positive views on spending – a typical stance in the later stages of an economic expansion, said Richard Curtin, chief economist of the university’s Surveys of Consumers.
Fortunately for retailers such as auto dealers, consumers have not yet found the current rate of inflation a reason to reduce their buying plans.
“Personal consumption can be expected to grow by 2.6 percent in the year ahead,” Curtin said.