Jun 30, 2023 - Economy

U.S. consumer sentiment surges 9%, Michigan survey finds

Data: University of Michigan; Chart: Axios Visuals

There are signs June was a turning point in Americans' largely gloomy views of the economic situation. New data out Friday morning supports the case and helps fill in the details about why.

Driving the news: The final University of Michigan consumer sentiment survey for June showed a 9% surge in overall sentiment and an even stronger surge in expectations for the future.

  • Notably, a key driver is receding inflation worries. Consumers' expectation for inflation over the next year fell to 3.3% in June, from 4.2% in May — a remarkably abrupt drop.
  • This time a year ago, Americans were anticipating year-ahead inflation of 5.3%.

Of note: The improvement in sentiment was sharpest among Democrats (among whom the sentiment index rose from 76.9 to 84.3) and political independents (55.5 to 61.5). Republicans' sentiment about the economic situation remained quite depressed (45.6 to 46.4).

What they're saying: "[T]his striking upswing reflects a recovery in attitudes generated by the early-month resolution of the debt ceiling crisis, along with more positive feelings over softening inflation," said Joanne Hsu, director of the survey.

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