18 Jul 2014
Dip in expectations pushes Reuters/Michigan Consumer Sentiment Index slightly down - ING
FXStreet (Łódź) - Rob Carnell from ING observes that the Reuters/Michigan Consumer Sentiment Index for July slid from 82.5 to 81.3, owing to a dip in expectations (current conditions actually picked up a bit).
Key quotes
"The expectations part, however, is the bit that tends to have the best relationship with consumer spending growth, though remains at a fairly decent level, consistent with real consumer spending growth carrying on at its underlying trend of about 2.5% (consumer spending grew by only 1.0% in 1Q14)."
"But whilst there are no particularly alarming aspects to the confidence release, 1-year inflation expectations did nose a little higher, reaching 3.3% again, which if it persisted might cause the Fed a little concern. "
"They, however, might point to the lower 5-Year inflation expectation number, which fell from 2.9% to 2.6%."
"All in all, there are too many conflicting elements within this survey release t draw any clear conclusions. We don’t expect markets to respond to this data."
Key quotes
"The expectations part, however, is the bit that tends to have the best relationship with consumer spending growth, though remains at a fairly decent level, consistent with real consumer spending growth carrying on at its underlying trend of about 2.5% (consumer spending grew by only 1.0% in 1Q14)."
"But whilst there are no particularly alarming aspects to the confidence release, 1-year inflation expectations did nose a little higher, reaching 3.3% again, which if it persisted might cause the Fed a little concern. "
"They, however, might point to the lower 5-Year inflation expectation number, which fell from 2.9% to 2.6%."
"All in all, there are too many conflicting elements within this survey release t draw any clear conclusions. We don’t expect markets to respond to this data."